Bukit Sembawang Buys S$196M Kallang Site for Condo Project
Bukit Sembawang Estates has signed a conditional S$196 million deal to acquire part of the Kallang Distripark from Tropical Warehousing, planning a waterfront condo with first-storey commercial space. The 548,959 sq ft site could yield 804,144 sq ft of gross floor area, with Savills estimating a gro
Residential developer Bukit Sembawang Estates has struck a conditional S$196 million deal to buy part of a central Singapore industrial estate, paving the way for a waterfront condo project. The SGX-listed builder signed a put and call option agreement for the 548,959 square foot (51,000 square metre) site, it said in a filing.
The property sits between the Kallang River and Pelton Canal, about 5 kilometres from the city centre. The developer plans apartments with first-storey commercial space on 268,048 square feet of the property, providing 804,144 square feet of gross floor area. Savills estimates the project's gross development value at over S$2 billion.
Known for its landed properties, Bukit Sembawang said the deal would strengthen and diversify the company's development portfolio, “complementing its established landed residential developments with a sizeable non-landed residential project”. The expected S$1 billion land cost includes S$814 million for the lease upgrading premium and land betterment charges, in addition to the cash payment to the seller. Based on the proposed gross floor area, the outlay works out to S$1,256 per square foot of accommodation.
Bukit Sembawang and the seller, Tropical Warehousing, are both linked to the Lee family behind OCBC Bank and Lee Rubber Company. Lee family vehicle LRG Property Investment holds 29.09 per cent of Bukit Sembawang, while Lee Rubber has a 13.07 per cent interest through direct and deemed holdings, according to the filing. The seller is an associate of Lee Chien Shih, a Bukit Sembawang non-executive and non-independent director, making the deal an interested-person transaction. The S$196 million purchase price represents 11.74 per cent of the developer's S$1.67 billion in net tangible assets as of 31 March, requiring shareholder approval.
The options remain conditional on shareholder consent, planning and head lessor approvals, and in-principle approval from the Singapore Land Authority for a fresh 99-year lease. Either party may rescind the option agreement if its conditions are not met within six months of signing, unless an extension is agreed. PrimePartners Corporate Finance has been appointed to advise the independent directors on whether the transaction is on normal commercial terms and is not prejudicial to the company and minority shareholders.
The acquisition would advance the redevelopment of the 1.4 million square foot Kallang Distripark, which has been zoned for housing since as early as 2003. The Urban Redevelopment Authority's proposed Master Plan amendment published on 14 August reconfigured residential, park and road zones, including provision for first-storey commercial use at a maximum plot ratio of 3. Nearby Kampong Bugis is separately planned for about 4,000 waterfront homes.
As part of the transaction, Bukit Sembawang would undertake demolition and infrastructure works covering a 2 hectare public park, a waterfront promenade and roads at the seller's expense. The Distripark site includes three octagonal Lee Rubber warehouses designed by architect Victor Chew. The National Heritage Board found that the site lacked the national importance required for National Monument preservation, though the URA has been exploring whether one warehouse could be retained as a heritage marker in the proposed park.
