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Jurong
Point sale
The sale of Jurong Point Shopping Centre could be in the offing,
according to property market watchers.
 
Jurong Point: Owners are seeking early redemption of $150m bonds
secured to the mall
Jurong Point Realty, a 50:50 joint
venture between listed Guthrie GTS and Lee Kim Tah which owns the bulk of
the space in the suburban mall, yesterday published a notice announcing its
intention for an early redemption of $150 million bonds secured to the mall.
This has led market watchers to speculate
that Jurong Point's two owners intend to securitise the mall or put it into
a Real Estate Investment Trust (Reit).
Suburban malls in Singapore are popular
among investors, following CapitaMall Trust (CMT)'s immense popularity.
Meanwhile, the market is buzzing with
speculation on who will bag another suburban shopping centre, White Sands at
Pasir Ris.
A tender for the property that closed on
Monday is understood to have attracted five bidders, including CapitaMall
Trust (which is part of the CapitaLand group), Asian Retail Mall Fund,
Centrepoint and even a high net worth investor. Another party that could be
interested is Lehman Brothers Real Estate Fund, which recently bought Hotel
New Otani.
CB Richard Ellis, which handled the
tender, declined comment when contacted.
BT understands bids are still being
evaluated by the mall's three owners. They are OCBC, Great Eastern and
Robinson, which own stakes of 55, 35 and 10 per cent respectively.
The top bid is said to have crossed the
$150 million mark.
At that price, the net property yield
would exceed 5 per cent, say analysts.
White Sands Shopping Centre, next to
Pasir Ris MRT Station, has a net floor area of 133,472 sq ft.
Market watchers suggested there may be
scope for increasing this area by about 10,000 sq ft, although this will
involve additional capital expenditure.
The mall is on a site that has about 88
years left of its original 99-year lease. The mall is currently fully let.
Major tenants include John Little, NTUC FairPrice, Courts and the National
Library Board.
As for Jurong Point next to Boon Lay MRT
Station, the 353,034 sq ft lettable area held by Jurong Point Realty could
be worth about $420 million, estimated an analyst.
The mall, built on a site with a
remaining lease of about 87 years, is fully let.
In its notice in BT yesterday, Jurong
Point Realty said it is holding an extraordinary general meeting for holders
of $150 million bonds, to seek their approval to redeem the bonds by end
November.
Their approval is sought because the
agreement with the bondholders does not allow for redemption before the
maturity date on May 22, 2006. -
by Kalpana Rashiwala SINGAPORE
BUSINESS TIMES 9 Sept 2004
Marina Square mall to get $100m revamp
Singapore Land subsidiary Marina Centre
Holdings (MCH) is finally embarking on a long-awaited revamp of its
16-year-old Marina Square mall at a cost of about $100 million.
Sources said work on the shopping centre
is expected to start around the fourth quarter of this year, once it
receives the green light from the authorities.
'The lettable area of the mall will come
down slightly from the current 675,000 sq ft, but the area will be of a
higher quality and generate an improved yield,' a source told BT.
BT understands that the revamp, which is
aimed at helping the aging mall fight the younger competition in the area,
will see glazing installed on portions of the building's facade to create a
more 'inviting look' than the current walled-up light-brown concrete
structure.
In addition, the atrium will be enlarged,
which will affect some of the shopfronts on the second and third levels.
Some 'dead corners' will also go.
To draw more shoppers to the shopping
centre, an underpass connection will be built.
This will link the proposed Convention
MRT Station under the first phase of the Circle Line - formerly called
Marina Line - to an exit next to Marina Mandarin hotel.
From there, shoppers can ride an
escalator to Marina Square mall's second and third levels.
BT understands that the underground link
will cost about $27 million, a small part of which is for the differential
premium to be paid to the government for permission to create shop units
that will line the air-conditioned underpass.
A previous plan for a major revamp three
years ago that could have cost more than $150 million had failed to take off
for undisclosed reasons.
That revamp would have seen the mall's
lettable area increase - partly from the conversion into shops of some
common areas owned jointly by MCH and hotels in the complex such as carpark
space - as well as the creation of new retail space facing The Esplanade
theatres.
The current scheme involves works only on
areas belonging fully to MCH, which owns 100 per cent of the mall.
MCH also owns 50 per cent in each of the
three hotels in the complex - Marina Mandarin, Pan Pacific and The Oriental.
According to records filed with the
Registry of Companies and Businesses, MCH posted a $39.6 million net profit
on turnover of $51.2 million in 2001. It had about $792 million in fixed
assets.
Marina Square has about 300 tenants and
has occupancy of over 90 per cent. However, it is currently not generating
top-dollar retail rents - something the revamp aims to redress.
With the revamp, a school on the mall's
fourth level is likely to go. The food court on Level 2 will move to a
bigger spot on Level 4.
Metro, which occupies 85,000 sq ft on
Marina Square's second and third levels, is now said to be in discussion
with MCH and has not decided whether to renew its lease when it expires in
November.
Sources said Metro is currently paying
very low rents for its department store space.
BT understands that if Metro decides to
stay, it may be given a much smaller area on Level 2 and the bulk of its
space will be on the third floor.
MCH is likely to renovate Marina Square
in two stages, while keeping the mall open, sources suggested.
Besides SingLand, MCH's other
shareholders include United Overseas Land, Overseas Union Enterprise, the
Government of Singapore Investment Corporation, Indonesia's Ciputra group
and a Hong Kong vehicle of Indonesian businessman Liem Sioe Liong.
- by Kalpana Rashiwala Singapore
Business Times 5 March 2003
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