Friday, June 25, 2010

CCT evaluating all options for StarHub Centre

Part of this process is a non-legally binding expression of interest exercise

THE manager of CapitaCommercial Trust (CCT) is evaluating all options relating to its asset plan for StarHub Centre, including the possibility of retaining the property as an office building, and has not made a decision yet.

'As part of the evaluation process, we conducted a non-legally binding expression of interest exercise to ascertain interest for the sale of the property.

As there is no certainty of any deal materialising, unitholders are advised to exercise caution in trading the units of CCT,' CCT said in a statutory filing to Singapore Exchange (SGX) yesterday.

Its announcement was in response to a BT article yesterday which, citing sources, said that the trust could be close to selling the 10-storey commercial building.

BT reported that StarHub Centre's transaction price was expected to be above the Dec 31, 2009, valuation of $268 million.

In its statement yesterday, CCT said that its manager had in January 2010 announced that, as part of its portfolio reconstitution plan for the trust, it had obtained outline planning permission from Urban Redevelopment Authority (URA) to convert StarHub Centre from pure commercial use to up to 80 per cent residential and 20 per cent commercial use.

BT reported yesterday that the expression of interest exercise for StarHub Centre closed last month and that parties had been shortlisted to do due diligence.

The outline permission granted by URA for a mostly residential project is capped at the current 4.9 plot ratio that the existing property is already built up to.

Based on this and the 80 per cent residential limit, a redevelopment scheme can yield about 266,230 sq ft of residential space, sufficient for 212 apartments of an average size of 1,200 sq ft, the BT report estimated.

StarHub Centre received Temporary Occupation Permit in 1998 and stands on a site with 99-year leasehold tenure starting Feb 1, 1996.

On the stock market yesterday, CCT ended one cent lower at $1.17 amid an overall weaker market.

Source: Business Times, 25 Jun 2010

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