Orchard Towers Starts Process For En Bloc Sale
SINGAPORE – Orchard Towers, a mixed-use 2-building project with office space and retail units, have formed a collective sale committee (CSC). The committee has hired Edmund Tie as marketing consultant for the potential en bloc sale, while Legal Solutions LLC was appointed as legal adviser, reported The Business Times on Thursday afternoon (19 August, SGT).
The next steps in the collective sale process is to calculate the development’s reserve price and the method of how the proceeds from the en bloc sale will be split among the strata unit owners. Thereafter, at least 80 percent of the strata unit owners by strata area & share value must sign the collective sale agreement before the marketing agent can launch the tender for the en bloc sale.
In a letter dated on Tuesday (17 August) viewed by The Business Times, Orchard Towers’ CSC informed all strata unit owners of the above appointments. It has also stated that it has started preliminary discussions on the different methods of dividing the sales proceeds, with both appointees providing advice.
“Considering that Orchard Towers is a mixed-use development comprising commercial and residential strata units as well as a strata-titled car park, the CSC is of the view that the method of apportionment would include valuation as one of its components,” CSC Chairman Callie Yah stated in the letter.
The owners are given until 1 September 2021 to submit the documents needed for the independent valuation of their strata units in Orchard Towers.
The collective sale committee was created after an extraordinary general meeting (EGM) was conducted in April this year. Then in May, The Business Times reported that the commercial property is among a number of ageing structures within Orchard Road that were considering to launch an en bloc sale.
Nicholas Mak, Research Head at ERA, disclosed to the news outlet that it is sometimes challenging for a mixed-use project, like Orchard Towers, to meet the minimum 80 percent approval threshold. This is because there is a higher chance that the owners of different types of properties may fail to come to an agreement on the method of splitting the sales proceeds.
Nonetheless, Delasa’s CEO Karamjit Singh previously said that Orchard Towers is “ripe for redevelopment” thanks to its age and its vibrant hospitality & retail scene.
Built in the early 1970s, Orchard Towers stands on a 6,130 sq m freehold site with a plot ratio of 4.9. The front tower along Orchard Road contains office space and retail units, while the rear tower in Claymore Road comes with some commercial units and 58 private residential units. It also has 361 car park lots.
Previously, it was reported in 2007 that Orchard Towers had mulled an en bloc sale in the past.
