[UPDATE] Munich-based family office AM alpha buys 112 Robinson for $269.7 mil

/ EdgeProp Singapore |

December 22, 2021 9:30 PM SGT

SINGAPORE (EDGEPROP) - This year has seen a number of commercial buildings in the CBD change hands. Capping off the year is 112 Robinson, which has just been sold for $269.7 million, with a caveat lodged on Dec 14. The purchase price works out to $2,925 psf based on the net lettable area of 92,205 sq ft. The 14-storey building, refurbished in 2003, has offices on the upper levels, with F&B and shop units on the ground floor. It sits on a freehold site of 9,794 sq ft.

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The buyer is Alpha Eins (SG) Pte Ltd, according to an Inlis search. It is said to be an entity of Munich-based family office AM alpha, which has a regional office in Singapore, according to its website. The acquisition of 112 Robinson is believed to be the family office’s first direct real estate acquisition in Singapore. The buyer is represented by Dentons Rodyk, Singapore’s oldest legal firm.

The seller of 112 Robinson is Robinson Singapore Holding Pte Ltd, where the ultimate holding company is Lion Trust. Cushman & Wakefield (C&W) is said to have brokered the sale.

One street away is Cecil Street, where the sale of PIL Building was done at the end of October, according to an Inlis search. The buyer is understood to be TE Capital Partners and LaSalle Investment Management. TE Capital is a real estate investment firm founded by siblings Emilia and Terence Teo, who hail from the Teo family that controls Tong Eng Group. Meanwhile LaSalle Investment Management is a real estate investment management firm and independent subsidiary of New York Stock Exchange listed real estate advisory firm JLL.

PIL Building is believed to have been sold for just under $325 million to a joint venture between TE Capital Partners and LaSalle Investment Management (Photo: Samuel Isaac Chua/EdgeProp Singapore)

PIL Building is a 17-storey office building at 140 Cecil Street and is believed to have changed hands for just below $325 million or about $1,900 psf per plot ratio (psf ppr) based on the gross floor area (GFA) of 218,447 sq ft, including top-up premium and development charge. The freehold building is expected to be redeveloped into a full commercial tower. C&W is said to have brokered the sale, while Dentons Rodyk is believed to be the lawyer representing the buyer. The deal is expected to be completed in 1Q2022.

Shaun Poh, executive director and head of capital markets expects interest in office buildings to remain strong among family offices and investors. “The sweet spot is commercial buildings sitting on 999-year or freehold sites,” he notes. “These are mainly available along Cecil Street and Robinson Road."

These office buildings may have a smaller footprint but provide an opportunity for the new building owners to reposition the asset, to add value through additions and alterations as well as enjoy naming rights, he adds. A decade ago, these properties were typically in the $100 to $200 million range. Today, the prices are closer to $300 million, notes Poh.

In light of the latest property cooling measures from Dec 16, properties zoned for commercial use and have redevelopment potential, will “look a lot more interesting to residential property developers too”, observes Poh. This is because one of the more punitive measures is a 10% increase in Additional Buyer’s Stamp Duty (ABSD) for developers buying development stes zoned for residential use to 35%, from 25% previously. It excludes a 5% ABSD to be paid upfront, which is non-remittable.

Maxwell House was sold for $276.8 million in a collective sale, and expected to be redeveloped into a new mixed-use scheme with 323 residential units and a retail podium of 46,000 sq ft (Photo: Samuel Isaac Chua/EdgeProp Singapore)

“When a site is zoned for commercial use, it is unlikely to attract ABSD even if it has the potential to be redeveloped into a mixed-use project that includes a residential component,” says Poh. Hence, he anticipates renewed interest in such commercial sites, including commercial collective sale sites. (Find Singapore commercial properties with our commercial directory)

An example is the collective sale of Maxwell House for $276.8 million in early May this year, brokered by C&W. Located on Maxwell Road in the Tanjong Pagar district, the site was purchased by a consortium led by Chip Eng Seng Corp (with a 40% stake), SingHaiyi with 30%, and Chuan Investments controlling the remaining 30%. Chuan Investments is an entity of Chuan Lim Construction, a Hong Kong-listed company with operations in Singapore, mainly in general building and civil engineering works. Dentons Rodyk was the lawyer representing the buyers, with Lee Liat Yeang, senior partner of the firm’s real estate practice group, as the lead lawyer.

A 99-year leasehold, 13-storey commercial building completed in 1971, Maxwell House is expected to be redeveloped into a new mixed-use development with 80% of the GFA for residential use and 20% for commercial use. The new development is expected to have 323 residential units and a 46,000 sq ft retail podium.

Maxwell House was eligible for the CBD Incentive Scheme rolled out by the government as part of the 2019 Master Plan. The scheme is aimed at rejuvenating the older parts of the CBD such as Cecil Street, Robinson Road and Tanjong Pagar. Shenton Way for instance, has undergone a complete transformation. “The CBD Incentive Scheme is aimed at encouraging more placemaking and live, work, play elements in the city centre,” notes Poh.

The sale of 112 Robinson brings the tally of commercial buildings in the CBD brokered by C&W this year to three.