Its bid of $15.51m is 76% higher than trigger price
THE Urban Redevelopment Authority (URA) yesterday awarded the tender for a Short Street hotel site to Fragrance Group, which offered the highest bid of $15.51 million or $353 per square foot per plot ratio (psf ppr).
The bid was 76 per cent higher than the trigger price of $8.8 million or $201 psf ppr.
It was also 11 per cent more than the next highest bid of $14.01 million or $319 psf ppr by Regal Land, which is behind the Hotel 81 chain.
Fragrance Group stood out from 14 other bidders to win the 99-year leasehold site, which covers 12,536 sq ft and offers a maximum gross floor area of 43,885 sq ft.
Other bidders include Centurion Properties, Sim Lian Land, Orchard Parade Holdings and Heeton Holdings.
URA has said that the site could yield 90 hotel rooms and would be suitable for a boutique hotel. It is near Bugis, with its cluster of arts and education facilities, and close to the future Rochor MRT station.
Fragrance Group chief executive Koh Wee Meng declined to share plans for the Short Street site when contacted.
Market watchers said that the small size of the site, coupled with falling construction costs, made the investment attractive.
The large number of bids could also reflect faith in Singapore's long-term potential as a tourist destination, one said.
But the economic downturn has dimmed the near-term outlook for the hospitality industry.
In April, CBRE Hotels (Asia-Pacific) forecast a fall in hotel occupancy, room rates and revenue per available room in Singapore this year.
Source: Business Times, 17 June 2009