HPL's Concorde Hotel & Shopping Centre is up for en bloc sale at $820 mil

The Concorde Hotel & Shopping Centre at 100 Orchard Road is launched for collective sale for the first time on September 3. Singapore-listed Hotel Properties Ltd (HPL) owns the 407-room Concorde Hotel on the fourth to ninth floors of the building; and 63 of the 98 strata shops in the three-storey retail podium, which has a total strata area of 108,510 sq ft. "The Concorde Hotel & Shopping Centre has been a central part of Orchard Road for decades," says Jeremy Lake, managing director of investment sales & capital markets at Savills Singapore. "Its redevelopment will usher in a new era of growth and revitalisation for the area." Savills Singapore, the marketing agent for Concorde Hotel & Shopping Centre has indicated a guide price of $820 million. The price tag includes bonus gross floor area (GFA) from balconies and a lease top-up premium of $213.1 million, which brings the land rate to $1,801 psf per plot ratio (ppr). Advertisement Advertisement The property occupies a 99,623 sq ft corner island plot with a 170m frontage along Orchard Road, which is one of the longest and second only to Ngee Ann City. It has four road frontages: along Orchard Road, Cavenagh Road, Kramat Lane, and Buyong Road. The site is zoned "Hotel" and has a 10-storey height control. According to HPL's 2023 annual report, the property has a 99-year lease from August 17, 1979, which means it has a remaining lease of 54 years. The property has a development baseline verified by the Singapore Land Authority (SLA) at 539,719 sq ft, which is equivalent to a plot ratio of 5.41, compared with the Master Plan plot ratio of 5.6. An Outline Planning Application has already been submitted to the authorities for a mixed-use redevelopment comprising 40% hotel, 20% residential and 20% commercial use, according to Savills' Lake, assuming the developer pays $213.1 million to top-up the lease to a fresh 99 years.

‘Key gateway project’

Potential uses for the site include luxury retail, residential, and hotel, subject to the relevant authorities' approval. "The buyer may also consider submitting an alternative Outline Planning Application for a different mix of uses," says Lake. "The site offers developers ample planning flexibility and multiple development options to create the next iconic landmark development in the heart of Orchard." Prior to the launch of the collective sale, an application was made to URA for the Strategic Development Incentive (SDI) Scheme. However, the application was not approved, as one of URA’s eligibility criteria for the SDI scheme is that the redevelopment proposal should include a minimum of two adjacent plots. Advertisement Advertisement That has not diminished the attributes of the site, says Lake. “The future development on the Concorde Hotel & Shopping Centre site will be a key gateway project that will connect Dhoby Ghaut to the upper stretch of Orchard Road,” he remarks. The future development will include a direct underground pedestrian walkway to the Somerset MRT Station (on the North-South Line). The site is currently a three-minute walk from both the Somerset MRT Station and the Dhoby Ghaut MRT Station, an interchange for three lines (Northeast Line, North-South Line and Circle Line). It will benefit from the Orchard Road rejuvenation plans, which include progressively pedestrianising a 500m stretch in front of the building from 2025. The Istana Park next door will also be expanded to include the space directly across the site, linking it with existing green spaces at Penang Road Open Space and Dhoby Ghaut Green.

Collective sale wave

Concorde Hotel & Shopping Centre's collective sale has also spurred a wave of collective sales among the neighbouring developments. Directly behind the building is United House, a freehold office building at 20 Kramat Lane. The collective sale committee (CSC) at the freehold office building has already appointed Edmund Tie as the marketing agent for their collective sale. The CSC is in the process of securing an 80% consensus among the owners for the collective sale. The strata owners of Singapore Shopping Centre have also appointed Edmund Tie to handle their upcoming collective sale. Located at 190 Clemenceau Avenue, the seven-storey, mixed-use development is directly opposite the Dhoby Ghaut MRT Interchange Station. The building sits on a 26,369 sq ft site with a 99-year lease from 1948. Advertisement Advertisement It isn't the first time Singapore Shopping Centre's owners have attempted a collective sale. The last time was in February 2020, when it was launched for sale at a reserve price of $255 million, with provisional approval for the site to be rezoned as a hotel.

An opportunity to create an icon

Over the past three years, there were just three successful collective sales along Orchard Road: Tanglin Shopping Centre, which sold for $868 million ($2,769 psf ppr) in February 2022; Ming Arcade, which fetched $172 million ($3,125 psf ppr) in December 2022; and Delfi Orchard, which went en bloc for $439 million ($3,346 psf ppr) in May this year. Savills brokered all three deals. "It's a testament to the stellar attributes of a development site within the Orchard locale, which is highly sought after by developers riding on the next wave of rejuvenation," says Lake. The Concorde Hotel & Shopping Centre site presents an opportunity for an incoming developer to create "an iconic and dynamic space that anchors and accelerates the rejuvenation of Orchard Road". He expects interest in the site to come from major local and regional developers, particularly those with hospitality expertise. While the zoning is 'Hotel', it is also ideal for a mixed-use and integrated development, says Lake. However, it is subject to URA approval. The tender will close on October 16, 2024.