DB2 offers final eight ground-floor strata retail units at Plus for sale from $3.8 mil

Plus, a 28-storey office building of blue glass with a two-storey retail podium has a prominent frontage at the junction of Cecil Street and Church Street. The strata-titled commercial building at 20 Cecil Street has 259 office units on levels 3 to 28 and 21 strata retail units on the first two levels. The property has a 99-year lease from 1989. A private fund of CapitaLand is now a major owner of Plus, having acquired the office tower for over $500 million in Septem- ber 2019. Since October 2020, selected single strata office units have been progressively released for sale. In 2023, strata office units at Plus were sold at prices ranging from $2,886 psf for two adjacent units on the fourth floor to $3,451 psf for a unit on the 27th floor. Based on caveats lodged with URA Realis, the latest transaction was for two adjacent units on the ninth floor that were sold for $7.2 million ($3,126 psf) in December. Read also: Office unit at Raffles Place for sale at $18.8 mil Advertisement

Premium retail units for sale

While the strata office units have been offered for sale, the retail units on the first two levels of Plus have been held by developer and investor DB2 since 2014. It was only last September that DB2 began to release the retail units on the second floor for sale. According to caveats lodged, the retail units were sold at prices from $4,698 to $4,927 psf. All 13 units on the second floor have been taken up. DB2 is now offering the final eight units on the first level for sale by private treaty, with CBRE as the sole marketing agent. The individual retail units with sizes from 388 to 807 sq ft have indicative prices ranging from $3.8 million ($9,794 psf) to $7.75 million ($9,603 psf). “These units are the most premium as they front the street,” says Clemence Lee, CBRE executive director of capital markets in Singapore. All eight units have been leased, with F&B tenants such as Hantol Korean Restaurant, The Salad Corner and Aunty Fatso. Other tenants include an incoming money changer and Pawa Bakery. All the units will be sold with the existing tenancy. Lee estimates gross yields of 3% to 3.5% based on the effective rents and indicative prices. He reckons the retail units will attract investors, including boutique real estate funds, family offices, local companies and high-net-worth individuals. Read also: Freehold strata offices at 108 Robinson Road put for sale at $18.2 million Advertisement The building is within the Downtown Core and is a short walk from the Raffle Place MRT Interchange Station (for the North-South and East-West Lines) and the Telok Ayer MRT Station (on the Downtown Line). “With a working population of up to 284,000 in the Downtown Core, there is constant and firm demand for retail offerings, especially F&B and essential services in the CBD,” says Lee.

Reduced supply of strata commercial units

Supply has also been reduced with the redevelopment of older buildings such as Clifford Centre, which Singapore Land Group will redevelop into a new Grade-A office tower; and Shenton House, which is also slated for redevelopment after it was sold en bloc to IOI Properties for $538 million last November. URA restrictions on new strata subdivisions of commercial developments within designated Central areas means the supply of these strata retail units will be limited, according to Lee. For instance, the new Grade-A strata office development, Solitaire at Cecil (a redevelopment of the former PIL Building) by TE Capital Partners and LaSalle Investment Management, saw all 15 strata office floors and two strata retail units on the first level snapped up within five months of its launch at the start of 2023. Based on caveats lodged, prices achieved for the office floors ranged from $3,865 to $4,325 psf. Two of the three office floors returned to the market have already been spoken for. One of the retail units at Solitaire on Cecil was sold for $5,397 psf, according to a caveat lodged in April 2023, while the other retail unit is said to have been sold for around $6,000 psf. Some local and foreign investors have switched to the strata commercial segment following the government’s latest round of cooling measures on April 2023. Hence, there has been an increase in interest and demand for commercial properties, as it offers investors an avenue for wealth preservation, says CBRE’s Lee. Read also: Sole strata restaurant unit at Killiney 118 for sale at $20 mil Advertisement He points to the recent divestment exercise by Singapore-listed City Developments, which released the remaining strata units at The Venue Shoppes, Sunshine Plaza, Fortune Centre, Cititech Industrial and Citilink Warehouse. Units at Cititech Industrial and Citilink Warehouse have attracted mainly local investors, says Shaun Poh, Cushman & Wakefield executive director of capital markets. CBRE’s Lee adds that CBD shophouses and strata commercial units will continue to be popular with local and foreign investors. Hence, prime freehold and 999-year shophouses in the CBD, such as Amoy Street and Boat Quay, have been transacted at prices of $5,000 and $8,000 psf.

Three major owners in 10 years

Plus has an interesting history as the building changed owners thrice in the past 10 years. Developed by Keppel Land in 1992, it was formerly known as Equity Plaza. In 2014, Keppel Land and Keppel Fund Management (formerly Alpha Investment Partners) sold the building to Plaza Ventures, a consortium led by Singapore-listed GSH Corp, which is controlled by Singaporean businessman Sam Goi, for $550 million. Plaza Ventures comprised GSH Corp (with a 51% stake), Goi’s private investment vehicle TYJ Group (14%) and Vibrant DB2 (35%). The consortium spent $100 million refurbishing the building, including changing the façade and converting the property into a strata-titled development named GSH Plaza. In 2017, Fullshare Holdings, a Hong Kong-listed- ed property investment and development company controlled by mainland Chinese billionaire Ji Changqun, acquired the building from Plaza Ventures for $750 million. Both GSH and DB2 did not exit the building entirely following the sale in 2017. GSH acquired nine strata office units on that floor for $31 million ($3,192 psf) in November 2016. The space has served as GSH’s headquarters since 2017. In July 2023, it announced that it had sold the penthouse for $38.8 million, but the deal was terminated in September 2023, as the purchaser was unable to complete the purchase. The purchaser forfeited the 10% deposit, or $3.88 million. Meanwhile, DB2 acquired the 21 strata retail units in the podium block of the building for $75.7 million ($6,175 psf), based on the strata retail area of 12,260 sq ft. The firm only started selling its retail units on the second floor last September. Given their street frontage, the retail units on the first level of Plus have seen strong demand from various F&B operators and retailers, says Lee. While the units are equipped for F&B, they can also be utilised for other purposes, such as a showroom, banking hall, service centre, medical or fitness studios, he adds.