Chinese tycoon's Bright Ruby Resources buys Far East Shopping Centre en bloc for about $908 mil

/ EdgeProp Singapore |

September 28, 2023 6:43 PM SGT

Far East Shopping Centre sold for about $3,350 psf per plot ratio (Photo: Albert Chua/EdgeProp Singapore)

Chinese steel tycoon Du Shuanghua has purchased Far East Shopping Centre en bloc via his investment vehicle Glory Property Development, an entity under Bright Ruby Resources, his Singapore-registered mining and resources company.

The purchase price for Far East Shopping Centre is around $908 million, which works out to about $3,350 psf per plot ratio (psf ppr), based on the potential gross floor area of 290,574 sq ft, under the Strategic Development Incentive (SDI) scheme. Michael Tay, head of Singapore capital markets, CBRE, the marketing agent for Far East Shopping Centre, brokered the sale.

Far East Shopping Centre is not Du's first prime real estate purchase in Singapore. In June last year, Ever Glory, another investment vehicle of Bright Ruby Resources, acquired the 37-storey, 999-year, Grade-A office building Income@Raffles from NTUC Income Insurance Co-operative for just over $1 billion.

A decade ago, Bright Ruby Resources paid $1.15 billion for the former Grand Park Orchard and its retail podium, Knightsbridge. It purchased the Marriot Champs-Elysees in Paris for US$464 million in 2014. The following year, it acquired the Hilton Hotel in Sydney for US$364 million. At the end of 2019, Bright Ruby paid US$870 million for the 438-room Westin Hotel Tokyo.

"We are glad to find the right buyer for Far East Shopping Centre," says CBRE's Tay. "This is someone who has invested in overseas properties in major cities around the world, such as Paris, Sydney and Tokyo, and will be able to bring such expertise to Singapore in the rejuvenation of Orchard Road."

Tay: As an investor, Bright Ruby has been forward-looking and tends to focus on prime assets in major cities (Photo: Albert Chua/EdgeProp Singapore)

Tay points to the former Grand Park Orchard at 270 Orchard Road, which sits on the corner of Orchard Road and Bideford Road. The property underwent an extensive asset enhancement exercise and reopened in 2022 as the 308-room Pullman Singapore Orchard, managed by Accor Group.

The prime retail space previously occupied by lifestyle retailer Abercrombie & Fitch at the former Knightsbridge reopened last year as Singapore's largest Adidas store. Other retail tenants include the Apple Store, Rolex, The Hour Glass and Ritual Gym.

"As an investor, Bright Ruby has been forward-looking and tends to focus on prime assets in major cities," comments CBRE's Tay. "And they have completed the asset enhancement and repositioning of a prime Orchard Road asset into the new Pullman Singapore Orchard."

Far East Shopping Centre at 545 Orchard Road has a 75m frontage along Orchard Road and a 55m frontage along Angullia Park in prime District 9. The property occupies a land area of 36,014 sq ft site with a 999-year lease from 1871. It is zoned for commercial use.

Through Glory Property, Du will likely reposition the asset into a commercial offering with a mix of uses -- from retail, hospitality, and office to residences.

After all, Far East Shopping Centre was identified by URA as one of the six buildings on the stretch of Orchard Road – between Cuscaden Road and Orchard Boulevard – to be redeveloped into "a new exciting destination".

The other five buildings are Hotel Properties Ltd's (HPL) Voco Orchard Singapore, Forum the Shopping Mall and HPL House, Wharf Estates Singapore's Wheelock Place, and Bonvests Holdings' Liat Towers.

HPL received the go-ahead from URA to redevelop its three properties along Orchard Road at the end of August. The new mixed-use development will comprise a hotel, retail, office and residential components, a rooftop garden and a performance theatre.

URA rolled out the SDI Scheme in April 2021 to incentivise owners to redevelop their property. Under the SDI Scheme, owners who redevelop their properties jointly with at least one of their neighbours to create "a new destination" will enjoy a 20% bonus gross floor area (GFA).

Besides an increase in GFA, the new owners will have flexibility in land use and building height. There will also be a direct underground pedestrian link from Orchard MRT Station, significantly increasing footfall to this part of Orchard Road, says Tay.

Far East Shopping Centre's price of about $3,350 psf ppr has surpassed the previous record set by Ming Arcade, which was sold last December for $172 million or $3,125 psf ppr. Savills Singapore brokered the deal.

The buyer of the former Ming Arcade is the Royal Group of Companies, a family office controlled by Singapore billionaire Asok Kumar Hiranandani. The new development will be a luxury hotel.

Nearby, Tanglin Shopping Centre was purchased en bloc by Pacific Eagle Real Estate in February 2022 for $868 million ($2,769 psf ppr). Pacific Eagle is the Singapore-based real estate investment and development firm of Indonesian billionaire Sukanto Tanato, the owner of Royal Eagle Group, which is involved in pulp, paper, palm oil, and energy. It will also be redeveloped into a new mixed-use commercial development.

The rejuvenation of Orchard Road is well underway.

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