[UPDATE] Matthew Ong of SLB Development buys Thye Hong Centre for $112.5 mil

By
/ EdgeProp Singapore
|
September 16, 2020 3:20 PM SGT
SINGAPORE (EDGEPROP) - Thye Hong Centre, the six-storey industrial building located at the junction of Leng Kee Road and Alexandra Road, is set to change hands for $112.5 million. The buyer is Singapore-listed property development and investment company, SLB Development. The deal was struck between Matthew Ong, CEO of SLB Development, and members of the Lee family of Thye Hong Manufacturing.
According to SLB Development's announcement posted on Singapore Exchange on Sept 17, "It is the intention of the group to redevelop the land on which the development is situated, which is in line with the business of the group as a property developer. The group does not intend to keep the development for long-term rental income."
Thye Hong Centre - EDGEPROP SINGAPORE
Thye Hong Centre, located at a prominent junction on Leng Kee Road and Alexandra Road (Photo: Samuel Isaac Chua/EdgeProp Singapore)
Sources say it’s not surprising that the buyer is SLB as Ong has been on the hunt for industrial assets this year, having sold down his inventory of such units. In fact, in an interview with EdgeProp Singapore in July, Ong said: “I’m actually quite bullish about the industrial sector.”
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What’s more, Thye Hong Centre at 2 Leng Kee Road sits on a 64,069 sq ft site with a freehold tenure. It is one of the few freehold sites on Leng Kee Road, as most of them have a 99-year lease.
The Leng Kee Road and Alexandra Road area has become more famous for its automobile showrooms and dealerships representing marques such as BMW, Ferrari, Mercedes, Porsche and Rolls-Royce. However, the legacy of its manufacturing past remains.
For instance, SiS Building at 4 Leng Kee Road is the headquarters of SiS International Holdings, which was founded in 1983 as an IT distributor and listed on the Hong Kong Stock Exchange in 1992. It has since expanded into a diverse range of businesses including real estate investment and asset management business.
Meanwhile, next door, Thye Hong Centre is where the former Thye Hong Biscuit and Confectionery Factory once stood. At the entrance to the building, there is a sign that informs visitors of its history. The former 40,000 sq ft factory, built in 1935, was the first automated biscuit factory in Singapore. At its peak, the plant produced up to 1,500 tonnes of biscuits and up to 100 tonnes of confectionery every month. Household names include Cream Crackers, Horlicks biscuits and Marie biscuits.
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Thye Hong Centre - EDGEPROP SINGAPORE
Thye Hong Centre, where the former Thye Hong Biscuit and Confectionery Factory used to sit, is located nex to SIS Building, named after Sugar Industry of Singapore (Photo: Samuel Isaac Chua/EdgeProp Singapore)

Biscuit manufacturing to real estate

It was in 1971 that Thye Hong signed a deal with one of Britain’s largest biscuit manufacturers, Huntley and Palmer, to produce part of the latter’s range of sweet and semi-sweet biscuits in Singapore and Malaysia under its subsidiary, Associated Biscuits. A decade later in 1981, Associated Biscuits bought Kuan Enterprises, which owned Thye Hong Singapore and Malaysia, for $12 million. The factory at Leng Kee Road closed then.
Lee Boon Leong, the son of former “Biscuit King” Lee Gee Chong of Thye Hong, and his mother, Tay Geok Yap, set up Thye Hong Properties and Thye Hong Development to redevelop the site into today’s Thye Hong Centre.
However, Lee Boon Leong passed away early this year. Another holding company, set up in 1982, is Thye Hong Manufacturing, which also has real estate as its principal activity. One of Lee Boon Leong’s two sisters, Lee Wah, is listed as one of the authorised representatives of Thye Hong Manufacturing.
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Incidentally, Thye Hong Manufacturing is also the entity that owns the family’s home, a Good Class Bungalow (GCB) at Garlick Avenue. Located at prime District 10, off Bukit Timah Road and Old Holland Road, the GCB sits on a sprawling freehold site of 101,554 sq ft.
The Good Class Bungalow -EDGEPROP SINGAPORE
The Good Class Bungalow at Garlick Avenue sits on a freehold plot of 101,554 sq ft (Photo: Samuel Isaac Chua/EdgeProp Singapore)

Family home sold for over $90 million

The family home at Garlick Avenue was said to have changed hands too, with the option issued on Sept 11, according to sources. It is believed to be a private treaty deal struck between the Thye Hong family and the buyer. The price is believed to be in the range of $90 million to $95 million.
Parties interested in the GCB before it was sold included developers, as the site is said to be large enough to be sub-divided into five smaller GCBs. However, the value is in keeping the land intact, says Samuel Eyo, managing director of Lighthouse Property Consultants, a specialist in marketing bungalows.
“Such large sites, of more than 100,000 sq ft, are hard to come by. But you must have deep pockets to keep the land whole,” he adds. “The site is big enough for a few bungalows, so three generations can live together on the same land plot, but yet have their own private residences. It’s good for building family bonds.” Hence, he believes it is more likely to appeal to the ultra-high-net-worth families. The property can also be held in a trust, he says.
The existing bungalow at Garlick Avenue is set back from the main road and protected by high, ivy-covered walls, tall trees and double gates. After all, it was near the family home that their father Lee Gee Chong, chairman of Thye Hong Biscuit Factory, who was just 49 years old then, was kidnapped and murdered in 1960. Five years later in 1965, their brother, Boon Leong, was also ambushed and almost kidnapped while he was driving alone.
Lee Gee Chong was the son of banker Lee Choon Seng, former chairman of Oversea-Chinese Banking Corp and president of Singapore Chinese Chamber of Commerce.
While the buyer of the GCB at Garlick Avenue remains elusive, renewal is likely to take place at Thye Hong Centre under its new owner SLB Development.
Matthew Ong, the scion of another storied family, hails from Lian Beng Group. It was founded in 1973 by his grandfather, Ong Sek Chong, who started as a subcontractor. Under Matthew’s father, Ong Pang Aik, the present chairman and managing director, the listed construction company is one of the biggest in Singapore today.
Matthew Ong of SLB Development - EDGEPROP SINGAPORE
Matthew Ong of SLB Development, has been snapping up freehold industrial buildings in recent years, including the former Khong Guan Industrial Building, which has since been redeveloped into Mactaggart Foodlink (Photo: Samuel Isaac Chua/EdgeProp Singapore)

Affinity for biscuit factories?

Coincidentally, Thye Hong Centre is not the first building that Matthew has purchased which had its origins as a biscuit factory. In 2016, while still at Lian Beng, Matthew had purchased Khong Guan Industrial Building for $31 million. It had been the site of the former Khong Guan Biscuit Factory for 64 years under the Chew family.
After purchasing Khong Guan Industrial Building, Matthew, who started SLB Development as a separate listed property development and investment company in 2017, redeveloped the site into the new Mactaggart Foodlink, a freehold industrial building with just 28 units, catering for central kitchens, food processing or cold room storage. The units, which range in size from 2,467 to 2,673 sq ft, are substantially sold to date.
Indeed, Singapore’s new generation of tycoons are set to build on the legacy of the past.
Check out the latest listings near: District 10, Garlick Avenue