Freehold five-storey building on Serangoon Road for sale at $48.8 mil

SINGAPORE (EDGEPROP) - A five-storey building at 202 Serangoon Road has been put up for sale via expression of interest (EOI) at the reserve price of $48.8 million. The building sits on a freehold site of 5,626 sq ft and has a gross floor area (GFA) of 16,733 sq ft.

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The reserve price translates to $2,916 psf based on GFA, says Desi Desmiriarti and Alex Ho of PropNex Realty, the exclusive marketing agency for the property.

The building was redeveloped in 2004, and was refurbished recently. It comes with a basement, lift and 10 mechanical parking spaces. Currently, the building has a retail store on the first level and a wedding banquet organizer and event space on the upper floors, namely the Afi iki Palace. However, the building will be sold with vacant possession, says Richard Tan, PropNex senior associate group district director.

The building comes with a restaurant/F&B licence. According to Tan, it is increasingly difficult to obtain new F&B licences or change of use to F&B in the Little India Conservation Area. “The standalone building has a double frontage along Serangoon Road and Hindoo Road,” he adds. “The building is unique as it has a gold façade.”

Having parking spaces within the building is an added bonus, observes Tan, especially in an area like Little India Conservation Area where parking space is rare. Farrer Park MRT station and the City Square Mall is also within a five- to six-minute walk.

“There’s a lot of investor interest – from both local and foreign entities – in commercial shophouses,” says Tan. This is backed up by PropNex Research in its recent 2Q2022 report on the commercial shophouse market.

In 2Q022, there were 64 commercial shophouse deals with a total value of $481 million, according to PropNex Research. It is 23% higher than the 52 transactions in 1Q2022, but 9.2% lower q-o-q than the $531 million worth of deals the previous quarter. (Find Singapore commercial properties with our commercial directory)

District 8 (Little India, Jalan Besar) recorded the highest number of transactions among the various districts. It accounted for 34 transactions worth more than $218 million in 2Q2022, smashing the last record of 29 transactions valued at $130 million in 2Q2013, according to PropNex Research.

More than 860 rental contracts worth $8.2 million were signed in 2Q2022. Median monthly shophouse rentals continued to grow to $5.50 psf in 2Q2022, from $5.37 psf in 1Q2022.

In the Serangoon Road neighbourhood, units with F&B licensing can command rental rates of $8 to $10 psf per month, and upper floors at $4 psf per month, estimates PropNex’s Tan. The building at 202 Serangoon Road will be sold with vacant possession, he adds.

“With looming global economic headwinds, investors are expected to continue to view commercial shophouses as a defensive asset with the ability to ride out uncertain times,” says PropNex Research.

The EOI for the freehold, commercial building at 202 Serangoon Road closed on September 8, 2022.