While most en bloc properties are sticking to or even lowering their reserve prices, there is one that is raising theirs.
People’s Park Centre rising $1.3 billion reserve price
Before even hitting the market for the first time, People’s Park Centre is already rising its reserve price from $1.3 billion to $1.35 billion. The change was passed by the majority at an extraordinary general meeting (EOGM) last week.
While the 80% mandate has yet to be secured, the development will have 1 year from 9 January 2019 to get the necessary signatories.
Should the mandate be reached, the collective sale committee says they are looking at a mid-year collective sale launch. They have however set themselves a target to secure the mandate within 4 months.
During the EOGM, the method of appointment was set at 80% based on the valuation of the units, 10% on the area of the units and 10% on the share value. The new reserve price places a 45% premium over the valuation of the site, up from the original 41%.
Rare Chinatown site expected to draw interest
The property currently consists of 120 apartment units, 256 offices, 324 shops and a carpark. There are more than 50 years left on the lease.
People’s Park Centre was built in the 1970s and it still holds many fond memories for the owners.
If the reserve price were to be met, each apartment, office and shop owner could receive up to $2.683 million, $4.431 million and $16.4 million each.
While some shop owners think that the reserve price is too low, the owner of the carpark may very well walk away with $56.7 million upon the successful sale of the site.
Mixed-use properties are often popular with developers but since last July’s property cooling curbs, they are no longer clamouring to fill up their land banks.
Analysts are expecting developers to be exercise more caution and to be more selective on land acquisition in the first half of the year. Mid-year might, however, be the turning point.
See more: Chinatown: Classic meets Modern