Thursday, June 17, 2010

2nd collective sale bid by Tanglin Shopping Centre?

THE ageing Tanglin Shopping Centre near Orchard Road looks headed for a collective sale that could bring in more than $1 billion for its owners.

Its sale committee received a big boost yesterday when substantial shareholder Millennium & Copthorne (M&C) Hotels said 'yes'.

M&C, which is part of the Hong Leong Group, owns 85 freehold strata units comprising shops and offices, as well as 325 carpark lots in the mall. It has held these since 1981.

The holdings come to 34 per cent of the mall's share value, said the Hong Leong group.

M&C chief executive Robert Hartman said talks on the potential disposal of its stake in the mall are at a 'very preliminary stage'. The proposed sale is also highly conditional, he said.

This is Tanglin Shopping Centre's second attempt at a collective sale, after a 2007 bid failed.

This time, the sellers are said to be aiming for a price of at least $1.25 billion. Sale committee chairman Len Hoo said they started on Feb 6 to collect signatures and almost 25 per cent have agreed to sell. A consent level of at least 80 per cent is needed.

Marketing agent ERA refused to comment.

Developed in phases, the 12-storey centre sits on freehold and 999-year leasehold land. It can be built up to 20 storeys without a development charge. The site is about 68,500 sq ft.

Mr Ronald Chia, a long-time tenant and owner of a few units, said the mall could be redeveloped into a residential-cum-retail centre with a medical facility built on the multi-storey carpark space in Cuscaden Road.

'Nobody knows how bad the building is. Our escalators are making so much noise but you cannot find the spare parts,' said Mr Chia. 'To (install) a new escalator, you would have to tear down part of the building.'

Ms Julie Yeo, who owns Antiques of the Orient, said the building pulls in customers looking for specific things.

Meanwhile, nearby Ming Arcade is also trying for a collective sale and has recently formed a sale committee.

Its attempt hinges heavily on the decision of Mr Ong Beng Seng, believed to own a substantial stake in the property. He has made two offers for the property but both were way below valuation, sources said.

Source: Straits Times, 17 Jun 2010

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