The Claremont Hotel, a freehold property a stone’s throw from Farrer Park MRT Station, has been launched for sale, with the seller seeking offers of over $70 million, revealed marketing agent JLL on Wednesday (13 Mar).
“With the recent spike in buying interest for hotels and hotel sites in Singapore, the owner has received multiple unsolicited offers for The Claremont Hotel. They have hence decided to engage JLL to run an official expression of interest (EOI) exercise to obtain the best offer from the market,” said Clemence Lee, senior director for capital markets at JLL Singapore.
Located on a corner plot along Serangoon Road, the eight-storey hotel comes with 90 rooms measuring from 172.22 sq ft to 387.5 sq ft, with an average size of 204.51 sq ft. With a gross floor area of around 30,591 sq ft, the property stands on a 4,838 sq ft site with a gross plot ratio of 3.0 and zoned for hotel use.
Aside from being only 100 metres from Farrer Park MRT station, the hotel is a 10-minute drive to both the Orchard Road shopping belt and Raffles Place.
Moreover, The Claremont Hotel is close to City Square Mall and Connexion, an integrated complex containing Farrer Park Hospital and Farrer Park Medical Centre. There are also several future projects in the vicinity, including Centrium Square, a 19-storey commercial development consisting of medical suites, office space and shops. Another upcoming project is Uptown @ Farrer, which will comprise homes, retail units and a 240-unit serviced residence run by lyf Farrer Park Singapore.
JLL noted that the demand for freehold hotels in Singapore was robust in 2018. For instance, Golden Wall Centre was purchased for $276.2 million, which works out to $2,331 psf per plot ratio (psf ppr). The Waterloo Apartments was also transacted at $131 million ($2,172 psf ppr). For the subject property, comparable deals include the $46 million acquisition of Wangz Hotel, which translates to $1.12 million per key. Another is the $37 million (S$1.28 million per key) sale of the Wanderlust Hotel.
For The Claremont Hotel, the seller’s asking price works out to approximately $2,300 psf ppr or about $780,000 per key.
“Freehold hotels with a palatable investment quantum of $50 to $100 million in Singapore are tightly held and seldom put into the market. We expect strong interest from real estate funds, developers, family offices, and hotel operators who are looking to acquire a centrally-located freehold hotel in a popular tourist destination that is undergoing rejuvenation and gentrification,” said Adam Bury, senior vice president at JLL Hotels & Hospitality Group
In addition, foreigners are allowed to purchase the property, which is being offered for sale with vacant possession, or via a one-year sale and leaseback contract. The transaction is also exempt from Seller’s Stamp Duty and Additional Buyer’s Stamp Duty.
The EOI exercise for Claremont Hotel closes on 18 April 2019.
Romesh Navaratnarajah, Senior Editor at PropertyGuru, edited this story. To contact him about this or other stories, email firstname.lastname@example.org