20 Cecil Street

Sale Of 9 Strata Office Units At 20 Cecil Street Falls Through

SINGAPORE – The sale of GSH Corporation’s nine strata office units on level 28 of the 20 Cecil Street office building for a total of S$38.8 million failed to push through, reported The Edge on Wednesday noon (6 September, SGT).

The seller was informed by the would-be buyer’s lawyers that the buyer cannot complete the acquisition of the commercial properties. The reason was not disclosed by GSH Corporation, which had announced the sale on 12 July 2023.

After “due deliberation”, both parties rescinded their sale and purchase agreement (SPA). However, the unnamed would-be buyer forfeited the 10 percent deposit of the S$38.8 million purchase price.

Meanwhile, The Business Times reported on Wednesday morning that there are some risks to Hotel Properties Limited’s (HPL) plan to redevelop HPL House, voco Orchard Singapore, and Forum The Shopping Mall into a massive mixed-use project.

First, the commercial property landlord will likely suffer a large fall in recurring income from the said properties while they are undergoing redevelopment.

In addition, the prevailing high interest rate environment will further increase the borrowing costs for the construction. Also, high-profile and large-scale developments tend to face costly delays during construction or in obtaining various approvals.

One way to mitigate these development risks is for HPL to team up with another property group with an excellent record in building integrated projects to jointly redevelop the Orchard Road properties. The Business Times’ Leslie Yee suggested Australia’s Lendlease or Temasek’s CLA Real Estate as potential partners.

However, Yee pointed out that there’s one risk that can’t be easily mitigated and that involves HPL’s most senior executive, Ong Beng Seng, who has a stake of more than 60 percent in the conglomerate.

In mid-July, it was reported that the Corrupt Practices Investigation Bureau (CPIB) arrested Ong so that the latter can provide information on his dealings with Transport Minister S Iswaran. Yee thinks the key man risk could be addressed if Ong were to divest his stake in HPL, but he’s unlikely to do so.

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