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News Release

Singapore

Seven industrial units at Kewalram House up for sale

Potential for future en bloc opportunity


​Singapore, 25 August 2014 – JLL has been appointed as the exclusive agent for the sale of seven units in Kewalram House, located in the established Bukit Merah industrial estate.

The offering comprises two units of approximately 3,100 sq ft and 4,300 sq ft on the ground floor that can be used for warehouse or factory space and five units on the third floor with unit sizes ranging from approximately 2,100 sq ft to 2,400 sq ft. Contiguous units are available for ease of configuration and amalgamation. The total strata area of the seven units is approximately 18,800 square feet.

"Ground floor units, which usually come with higher floor loading capacity and direct loading access, are hard to come by. Over the last one year, there were only two such units sold in the Bukit Merah Planning Area," said Ms Yong Choon Fah, National Director for Investments, JLL.

The vendors are expecting offers exceeding $10 million for all seven units, which works out to $620 per sq ft for the ground floor units and $480 per sq ft for the units on the third floor.

"As part of the government's efforts to keep industrial space affordable for the business community, land parcels offered via the Industrial Government Land Sale Programme now come with shorter tenures capped at 30 years," noted Ms Yong. "As a result, buyers will see value in the subject properties which are on a 99-year leasehold site with balance tenure of slightly over 45 years."

"The offering, centrally located near transport nodes and residential areas, is expected to be sought after by industrialists seeking their own premises for security against rent fluctuations. It will also attract investors due to the immediate rental income from the six out of seven units that are currently tenanted", said Ms Yong. "The gross yield of approximately 5 per cent is also attractive given the current low interest rate environment."

Built in the 1980s, Kewalram House is a 5-storey light industrial building with 63 units on a site zoned for Business 1 use with a plot ratio of 2.5. It is the first industrial development undertaken by the Kewalram Chanrai Group under Kewalram Realty Limited.

"There could be potential for future en bloc opportunity as the gross floor area (GFA) of the building has not exceeded the maximum GFA allowed under the Master Plan 2014. The units for sale represent around 9.6 per cent of the total share value and 9.3 per cent of the total strata area in the development," added Ms Yong.

The sale is being conducted through a tender exercise which will close on Thursday, 25 September 2014, at 2.30 p.m. Prospective buyers have the option of tendering for either all seven units or individual units of their choice.

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Note to editors:

1.       Download the image of Kewalram House here.