[UPDATE & AMENDMENT] Mortgagee sale of vacant hotel site at Devonshire Road, priced from $30 mil

/ EdgeProp Singapore |

December 1, 2021 7:00 AM SGT

SINGAPORE (EDGEPROP) - The tender for a vacant 5,370 sq ft development site at 8 Devonshire Road — located near Somerset MRT Station — has been launched with a guide price of between $30 million and $35 million. The mortgagee sale is managed by the auction team at Knight Frank Singapore, and the tender closes on Feb 11, 2022.

Read also: Five shophouses on Devonshire Road on sale for $40 mil

This freehold piece of land is located near the junction of Devonshire Road and Killiney Road in prime District 9. The site is currently zoned for a 44-room hotel development with a gross plot ratio of 2.8. Written permission for this land use was first granted by URA in October 2019.

According to URA records, an extension to grant the land for hotel use was given on Sept 30. Knight Frank has stated in its marketing documents for the site that this extension is set to lapse in October 2023. Previously, the site was a key asset at the centre of a liquidation case involving Ivy Lee Realty. The company was owned by Ivy Lee, one of the top real estate agents in Singapore in the early 2000s.

In 2012, the site at 8 Devonshire Road was slated to be redeveloped into a six-storey apartment block called Devonshire 8. Developed by Ivy Lee Realty, the proposed 30-unit condominium would have consisted of one-bedroom units. It was slated for completion in 2017.

URA map Devonshire 8 - EDGEPROP SINGAPORE

The site is approved for a hotel development, but the planning permission expires in October 2023. (Source: URA)

But by October 2015, only one unit of the 30 units in the project had been sold. Ivy Lee Realty was then sued by licensed moneylender MWA Capital for unpaid debts.

According to media reports, Ivy Lee Realty had borrowed $10 million from MWA in July 2014, at a 5% monthly interest rate. As a security for the loan, the development company put up options for the remaining 29 unsold units at Devonshire 8.

After Ivy Lee Realty failed to meet repayments, MWA applied to the High Court to secure repayment of the $10 million in May 2015. In August that year, the High Court granted summary judgement for MWA to claim $6.7 million.

As Ivy Lee Realty was unable to pay MWA the amount awarded under the summary judgement, the developer was subsequently ordered to be wound up on Nov 9, 2015. Liquidators proceeded to sell Devonshire 8, and the sale — priced at $25.9 million — was completed in July 2016. Court documents for the case, however, did not reveal the identity of the buyers.

Following the sale of the 8 Devonshire Road site, URA granted written permission for a change of use for the site to a proposed serviced apartment development. Land records indicate that approval was granted to a development proposal for a six-storey, 21-unit serviced apartment project, but the project never materialised and the land remains vacant.

Ivy Lee Realty abandoned site - EDGEPROP SINGAPORE

In 2015, a project on the site was abandoned after the developer, Ivy Lee Realty, went bust. (Picture: Knight Frank)

AMENDMENT:

Just one building away at 110 Killiney Road is the former Tai Wah Building, which was sold en bloc to private equity investment firm Lucrum Capital for $84.89 million in November 2017. (See potential condos with en bloc calculator)

Lucrum Capital announced plans to redevelop the site into a mixed-use development with a commercial podium on the ground floor and serviced apartments on the upper floors. In September 2019, the investment firm had put the site up for sale by expressions of interest at $155 million. (Find Singapore commercial properties with our commercial directory)

However, the firm says that it’s proceeding with the construction of the hotel. URA has granted written permission for the proposed erection of a six-storey hotel with 115 rooms and a restaurant on the ground-floor for the site.

Meanwhile, two condominiums in the vicinity have also launched collective sale attempts this year. The Bayron, a freehold residential development at 13 Devonshire Road, launched its second collective sale attempt with a guide price of $376 million. It had launched an earlier attempt in September last year at the same price. Its neighbour, the eight-storey Devonshire Apartments at 17 Devonshire Road, also launched its own collective sale tender in March this year, with a guide price of $66 million. The tender for both collective sales closed on April 6, with no successful bids announced.

The error above on Lucrum Capital is regretted.