BreadTalk boss offers prime shophouses for sale; Macly Group’s Tedge commercial units open to single buyer from $18 mil

/ EdgeProp Singapore |

July 16, 2020 6:00 AM SGT

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SINGAPORE (EDGEPROP) - When two prominently-located corner shophouses were put up for sale by Savills Singapore a fortnight ago, they generated a lot of enquiries. One is located at 8 Sixth Avenue while the other is located at Lorong Mambong in Holland Village.

The corner shophouse at 8 Sixth Avenue sits on a freehold site of 2,451 sq ft, with an existing gross floor area of 2,519 sq ft. BreadTalk occupies the first level while That Tuition Café, a co-working-style tuition centre, occupies the second floor.

EDGEPROP SINGAPORE - The shophouse at 8 Sixth Avenue is fully leased and available for sale by private treaty with an asking price of $15.5 million (Photo: Savills Singapore)

The shophouse at 8 Sixth Avenue is fully leased and available for sale by private treaty with an asking price of $15.5 million (Photo: Savills Singapore)

Sixth Avenue shophouse for $15.5 million

It is owned by George Quek, founder and chairman of BreadTalk Group, who purchased it for $12.5 million ($4,962 psf) in April 2018, according to a caveat lodged with URA Realis.

There are only around 20 shophouses in this enclave and 8 Sixth Avenue stands out because of its prominent corner location, notes Yap Hui Yee, director of investment sales & capital markets at Savills Singapore, the exclusive marketing agency for the property.

“Such an offering is hardly available as many of these shophouses are tightly held by high net worth individuals,” says Yap. “This corner unit combines an auspicious address in an affluent neighbourhood and approval for F&B use for part of the ground floor space.”

Over the years, Sixth Avenue has transformed into a notable lifestyle and recreational option for residents in the Bukit Timah area, according to Yap.

The shophouses in the area are much sought-after given their location in an established prime District 10 residential enclave of predominantly landed property and condominiums and upcoming high-end developments such as Allgreen Properties’ Fourth Avenue Residences and Royalgreen.

They are also just a three-minute walk to the Sixth Avenue MRT station on the Downtown Line, close to multiple bus stops and easily accessible by car from Bukit Timah Road and Dunearn Road.

The shophouse at 8 Sixth Avenue is fully leased and available for sale by private treaty. The asking price is $15.5 million ($6,153 psf).

The corner shophoust at Lorong Mambong has an asking price of $20.8 million (Photo: Savills Singapore)

Lorong Mambong shophouse for $20.8 million

Located at 22 Lorong Mambong, the other prominent shophouse sits right at the heart of Holland Village. It is fully leased: the tenant on the ground level is Harry’s Bar, while the upper level is occupied by F45 gym.

The corner shophouse at 22 Lorong Mambong was purchased by BreadTalk’s subsidiary Imagine Properties, for $16.2 million ($4,830 psf), according to a caveat lodged in October 2017. It sits on a freehold site of 2,350 sq ft with a gross floor area of 3,354 sq ft.

The property is now available for sale by private treaty, with Savills as the exclusive marketing agency. The asking price is $20.8 million ($6,202 psf). “The prospective buyer is expected to benefit from the ongoing transformation of Holland Village, which has an eclectic mix of old coffee shops and new, hip F&B outlets and bars, as well as lifestyle shops,” says Yap.

The last recorded transaction was at the other end of the street. It was the sale of 48 Lorong Mambong to property investment and development group, 8M Real Estate. The transacted price was $8.3 million back in January 2019. The shophouse sits on a freehold site of 1,259 sq ft.

The Holland Village MRT station and taxi stand as well as bus stops are nearby, making the area very accessible, notes Yap. Not surprisingly, the freehold shops in the prime District 10 enclave of Holland Village, which includes Holland Avenue and Lorong Liput, are popular with investors.

The latest transaction in Holland Village was for a shop unit on Holland Avenue that changed hands for $15.2 million in March this year. The property sits on a freehold site of 1,507 sq ft with a built-up area of 2,042 sq ft. The sale price translates to $7,444 psf based on the existing built-up area.

EDGEPROP SINGAPORE - Tan: Even though Covid-19 may have clouded the short-term outlook for the F&B sector, at the end of the day, we are social creatures; people still want to go out and meet their friends for a meal or drinks (Photo: Samuel Isaac Chua/EdgeProp Singapore)

Tan: Even though Covid-19 may have clouded the short-term outlook for the F&B sector, at the end of the day, we are social creatures; people still want to go out and meet their friends for a meal or drinks (Photo: Samuel Isaac Chua/EdgeProp Singapore)

‘Relatively resilient’ sector

The fact that the two freehold shop units are zoned for commercial under the URA Master Plan also means that they are not subjected to additional buyer’s stamp duty restrictions and therefore attractive to foreign buyers, says Galven Tan, deputy managing director of investment sales and capital markets at Savills Singapore.

“Given the level of enquiries generated by the two shophouses at Lorong Mambong and Sixth Avenue, we felt that this sector is relatively resilient,” he adds.

As such, Savills is now marketing the commercial units at Tedge, a mixed-use development by Macly Group, on an exclusive basis. Located at the junction of Changi Road and Telok Kurau Road, the five-storey-plus-attic development contains 42 apartments on the upper floors and four strata commercial units on the podium floor. It sits on a freehold site of about 18,800 sq ft.

The four strata commercial units have four different titles, but will be sold as a whole to a single buyer, says Tan. The total floor area of the four units is 5,576 sq ft, of which 75% is approved for restaurant/F&B use.

There used to be a coffee shop at that same junction, he adds. The coffee shop was situated within one of nine single-storey shophouses located at Telok Kurau before it was purchased en bloc by Macly Capital for $35.5 million in January 2018.

“This is a very mature private residential neighbourhood, and it’s a natural catchment for residents in the area,” notes Tan. “The other F&B outlets on that same stretch — the food courts, coffee shops and restaurants — have been there for many years, hence, it’s an established F&B enclave.”

Tan believes the commercial units at Tedge are ideal for a single buyer as it will be better for the owner to plan the F&B concept. “If you sell to four individual strata owners, there will be competing requirements and it will be difficult to manage conflicting interests,” he adds.

The commercial podium which has a total floor area of 5,576 sq ft, is available for sale at $18 million (Photo: Macly Group)

No competition from future developments for Tedge

The Tedge commercial podium will have a prominent frontage along Changi Road. The project is raised above street level, and there will be seven designated parking spaces for the commercial units within the development. However, street parking is available nearby too, notes Tan.

Based on URA’s plan, there are no other new areas that have received F&B approval along that stretch. “There will be no competition from future new developments,” he adds.

The commercial units at Tedge are available for sale by expressions of interest, which will close on August 18. The asking price starts from $18 million ($3,228 psf based on floor area).

Tan sees interest coming mainly from local business owners who are familiar with the location and understand the market dynamics there.

The residences at Tedge are a mix of two- to four-bedroom apartments and penthouses. When it previewed in March, eight units were sold at prices ranging from about $1.28 million ($1,652 psf) for a 775 sq ft, two-bedder to $1.87 million ($1,508 psf) for a 1,238 sq ft, four-bedder. Average price of units sold was $1,597 psf. The project is expected to appeal to young families as it’s near the Kembangan MRT station, with schools in the vicinity, such as Tao Nan School, St Patrick’s School and Tanjong Katong Girls’ School.

Tedge is scheduled for completion in 2022. “The commercial podium is ideal for restaurants, bistros, gourmet coffee joints or a food court,” Tan observes. “Even though Covid-19 may have clouded the short-term outlook for the F&B sector, at the end of the day, we are social creatures; people still want to go out and meet their friends for a meal or drinks.”

For price trends, recent transactions, other project info, check out these projects' research page: Sixth Avenue, Lorong Mambong, Tedge, Fourth Avenue Residences, Royalgreen