Singapore’s Nehsons Building Being Acquired By Japan’s Kajima

SINGAPORE – A wholly-owned subsidiary of Kajima Corporation, one of the biggest and oldest construction companies in Japan, is purchasing the 9-storey Nehsons Building at Peck Seah Street, reported The Business Times on Wednesday morning (29 June, SGT).

CBRE is believed to be brokering the sale of the commercial property. The seller of the commercial property is a Singapore-incorporated entity controlled by the Ng family from Malaysia, which constructed the building on a 99-year leasehold land plot that it acquired from the Singapore government in 1970. Now, the site has a remaining leasehold tenure of 47 years.

Market observers expect the Japanese construction firm would look at redeveloping Nehsons Building.

However, the commercial property is not qualified for the CBD Incentive Scheme, as it’s located outside the boundary for one of the three areas earmarked by Urban Redevelopment Authority (URA) for the scheme.

Notably, the CBD Incentive Scheme grants additional gross floor area to older predominantly office buildings in certain locations in Singapore’s central business district (CBD) if their owner will redevelop the commercial assets into mixed-use developments.

Aside from that, Nehsons Building’s current gross floor area (GFA) of about 69,240 sq ft slightly surpasses the maximum permitted based on the 5.0 plot ratio for the 13,819 sq ft commercial-zoned site under the 2019 Master Plan.

Still, market watchers think there is potential for Kajima Corporation to improve Nehsons Building by redeveloping it into a mixed-use project that will feature residential and commercial components.

Meanwhile, Kajima Corporation bought 55 Market Street, a 16-storey office building, earlier this year. The 999-year leasehold asset was acquired from property investment manager AEW for S$286.9 million, which works out to S$3,450 psf based on the commercial property’s net lettable area (NLA).