The once sleepy Tanjong Pagar district looks set for another boost that could turn the area into one of the most prized downtown residential districts.
The Keppel group yesterday unveiled a billion-dollar asset reshuffle that will see it put up a massive residential development at its flagship buildings – Keppel Towers and GE Tower – in the heart of the area, whose skyline already boasts the Icon Loft private apartments and the 50-storey Pinnacle@Duxton Housing and Development Board project.
“The rapid transformation of the business district into an area for live-work-play and future development plans for the Tanjong Pagar precinct present good investment opportunities into the future,” said Mr Kevin Wong, group chief executive officer of Keppel Land.
The new high-rise residential project with commercial space on the first level, along Hoe Chiang Road and Tanjong Pagar Road near the Tanjong Pagar MRT STation , will have a plot ratio of 5.6 and total gross floor area of 481,800 sq ft, yielding about 620 residences.
Keppel Land’s asset-swap deal with K-Reit Asia will see it sell a third of its interest in Phase One of the Marina Bay Financial Centre (MBFC) for about $1.4 billion. In turn, it will acquire K-Reit Asia’s Keppel Towers and GE Tower for $573 million.
The 27- and 13-storey office buildings were completed in 1991 and 1993. Keppel plans to develop them in two to three years, possibly into 46- and 26-storey high rises.
K-Reit Asia said it will fund the acquisition of the MBFC Phase One using proceeds from the sale of the two buildings ($570 million), bank borrowing ($821 million) and the proceeds from its November 2009 rights issue ($41.5 million).
MBFC Phase One consists of Towers 1 and 2, the Marina Bay Link Mall and 684 car park spaces.
The office towers’ major tenants include Standard Chartered, Barclays Capital, BHP Billiton, Nomura and Prudential.
The asset swap, expected to be completed by the end of December, will increase K-Reit Asia’s portfolio asset size from $2.4 billion to $3.4 billion.
For Keppel Land, assets under its management will expand from $10.2 billion to $11.1 billion after the asset swap.
Source: Today, 12th Oct 2010