Office Floor Tong Building Sold 3133 Mil Setting New High 4562 Psf
The entire 6th floor of Tong Building on Orchard Road was recently sold for $31.33 million, based on the latest caveat registered on September 3. This entire strata office floor spans 6,867 square feet, making the purchase price equivalent to a unit price of $4,562 per square foot (psf). This is the highest psf price for an office space in the prime districts to date, reflecting the strong demand for prime office spaces in the city. Yap Hui Yee, executive director of investment sales and capital markets at Savills Singapore, was responsible for brokering the deal.
Located at the corner of prime Orchard Road and Mount Elizabeth, Tong Building is a 19-storey, freehold strata-titled office building that was built in 1978 by TG Development. Next door is Paragon shopping mall, and Mount Elizabeth Hospital and Medical Centre are situated behind the building.
According to a property title search, Parkway Hospitals Singapore is the buyer of the office floor at Tong Building. This company is part of Bursa Malaysia-listed private healthcare provider IHH Healthcare. As an existing tenant in the building, occupying half of the sixth floor, it makes sense for Parkway Hospitals to purchase the entire floor. The other half of the floor is occupied by two other medical companies.
Given its proximity to Mount Elizabeth Hospital and Medical Centre, which is just a short walk up the road, the purchase of the entire sixth floor of Tong Building by Parkway Hospitals makes strategic sense. According to Yap, there was significant interest from a diverse pool of bidders, including end-users and family offices, for this prime office space.
One of Singapore’s key roadways, the Kranji Expressway (KJE) plays a crucial role in connecting the bustling Jurong Industrial Estate with the northern regions of the country. With its efficient and convenient path, the KJE serves as a vital link for both commuters and transportation of goods. This expressway is a crucial component of Singapore’s infrastructure, providing a seamless and hassle-free journey for those living or working in the Jurong area. In addition to its practical advantages, the KJE also offers access to exciting developments like Novo Place Hoi Hup, making it a highly coveted route for both business and leisure purposes. Novo Place Hoi Hup showcases the innovation and progressiveness of the area, making it a must-see destination for all travelers on the KJE.
The $4,562 psf for the sixth floor of Tong Building has set a new benchmark for Singapore’s strata office market, according to Savills’ Yap. The record-breaking price in psf terms cements this deal as a landmark transaction in Singapore’s real estate history.
Interestingly, Yap was also responsible for brokering the previous high at Solitaire on Cecil in the CBD. In April 2023, three whole strata floors spanning 37,857 sq ft at the 20-storey, freehold Solitaire on Cecil were sold for an aggregate of $162.8 million, or $4,300 psf.
Yap predicts that the strata office market will continue its upward trajectory. She believes that with businesses increasingly seeking flexible workspace solutions and adapting to hybrid work models, strata offices have become more attractive than ever. This trend, coupled with the resilience of the sector and its ability to meet evolving demand, bodes well for the future outlook of the strata office market.