HOTEL 1929 on Keong Saik Road has been sold for $35 million. The price works out to around $1.09 million per room for the freehold hotel.
The seller is an entity controlled by hotelier-restaurateur Loh Lik Peng, founder of Unlisted Collection.
Under a leaseback arrangement, Mr Loh will continue to operate Hotel 1929 and its in-house restaurant, Ember. (He owns Ember jointly with chef Sebastian Ng.)
Hotel 1929′s buyer is believed to be a company currently owned by Cheong Keng Hooi, a member of the family that developed International Plaza in Tanjong Pagar.
The four-storey property comprises five adjoining shophouses on a freehold triangular plot of 3,281 square feet with a built-up area of around 13,900 sq ft.
When contacted, Mr Loh confirmed the sale. “We were never planning to sell (Hotel 1929),” he said, when asked if Unlisted Collection will sell its two other Singapore hotels: New Majestic Hotel on Bukit Pasoh Road, a short distance from Hotel 1929; and Wanderlust Hotel on Dickson Road in Little India.
On the sale of Hotel 1929, he said he was approached by the buyer with an “attractive offer” and it was “optimal timing” as the group had acquired the hotel some time ago.
The hotel is achieving room rates of $200-plus a night and is operating “very well” in terms of occupancy, said Mr Loh.
He acquired the conservation shophouses around 2002 for $3.4 million in a mortgagee sale and the asset, though restored, was in “pretty rough shape” at the time. He pumped in a further $1.5-2 million to spruce up the property.
Hotel 1929 opened its doors in February 2003, helping to catalyse the gentrification of Keong Saik Road, which was once a district known for its brothels.
Unlisted Collection also owns three boutique hotels in London as well as a hotel in Shanghai, The Waterhouse in South Bund. It also operates a string of restaurants in the three cities. The group will be opening a Sydney hotel either late next year or early 2015.
The sale of Hotel 1929 is understood to have been brokered by Historical Land Pte Ltd, a boutique property agency specialising in shophouses. Historical Land also handled the sale of the 49-room Berjaya Hotel on Duxton Road in May for $50 million, pricing the asset at slightly over $1.02 million per room. Now known as The Duxton Hotel, it comprises eight adjoining conservation shophouses, all three storeys high with a loft, sitting on land with a lease tenure balance of about 74 years.
Last month, the freehold Grand Park Orchard (including its retail podium Knightsbridge) was transacted at $1.16 billion. Assuming the retail space is valued at $9,500 per square foot, the 308-room hotel would be valued at nearly $1.5 million per room. A higher price of $10,000 psf for the retail space would translate to a hotel pricing of close to $1.4 million per room.
Another deal last month was the $210.85 million sale of The Sentosa Resort Spa (formerly known as The Beaufort Singapore). This works out to about $981,000 per room for the 215-room property, which is on a site with a remaining lease of about 60 years.