Cortina Holdings Granted Option To Buy Office Floor At Thong Teck Bldg
SINGAPORE – Cortina Holdings, a local luxury watch distributor, has been granted an option to acquire the entire 4th floor of the 9-storey Thong Teck Building at 15 Scotts Road for S$49 million in cash, reported Mingtiandi on Wednesday evening (5 October, SGT).
The selling price translates to S$3,568 psf for the 13,735 sq ft office space. However, it’s 7 percent lower than the asking price of S$52.5 million (S$3,822 psf) when the office floor entered the market in late-August 2022.
The seller is the Singapore Institute of Management (SIM) Group, a local private education institution, while CBRE brokered the office transaction.
The potential acquisition of a slice of the Thong Teck Building comes as the lease of Cortina Holdings’ regional head office in Ngee Ann City Tower B at 391B Orchard Road will soon expire.
As part of the office transaction, SIM will transfer existing lease agreements to Cortina once the deal is concluded on 1 December 2022. This would provide rental income for the company, which sells luxury watches like Rolex and Patek Philipe.
Thong Teck Building is a freehold office tower completed in 1973. Apart from being a stone’s throw away from the Far East Plaza mall, the commercial property is just a short walk to both the Newton and Orchard MRT stations.
When the office floor was put up for sale in August, CBRE Singapore’s Capital Markets Executive Director Clemence Lee commented that “freehold strata office floors housed in good quality office developments in Orchard Road are tightly held and rarely made available.”
Notably, entire office floors in the vicinity of Orchard Road rarely become available. The prior sale of a strata office floor was when local real estate company Top Global bought level 18 of the Tong Building in October 2017 for S$23.3 million. That sale came after the family office of the founders of Chopard, a high-end watch and jewellery house, purchased the entire 13th floor in Tong Building for $25.5 million in May 2016.
The granting of the option to purchase comes as the volume of strata office transactions in Singapore has fallen over the past few months.
According to a report from property consultancy Knight Frank, only 145 strata office units collectively worth S$365 million were transacted in H1 2022 – down 16 percent compared to the prior 6-month period.
Nonetheless, the prices of existing strata offices in Singapore appear to be on an uptrend after the Urban Redevelopment Authority (URA) banned the strata subdivision of commercial properties in the Central area.