Fragrance Group Buys Katong Plaza 180 Mil Potential Redevelopment New Hotel

Singapore’s premier property developer, Fragrance Group, has recently announced the acquisition of Katong Plaza in Marine Parade for a staggering $180 million. This translates to a land rate of $1,809 psf per plot ratio (psf ppr), including the land betterment charge. The property, which is located at 1 Brooke Road, is a freehold commercial and residential mixed-use development. It comprises of 132 strata retail units and 14 residential apartments. According to Terence Lian, the head of investment sales at Huttons Asia who brokered the deal, owners of the retail units will be receiving proceeds ranging from $502,000 to over $6 million, while residential owners will be getting between $2 million and $5.1 million.

Currently, the development sits on a total land area of 34,044 sq ft with a gross plot ratio of 3.0. This gives it a maximum gross floor area of 102,132 sq ft. Although the property is zoned for commercial and residential use, it has received approval from the Urban Redevelopment Authority (URA) for hotel use. Lian estimates that the new hotel could yield between 300 and 340 rooms. Situated in prime District 15 in the east, the property is just 120m from the Marine Parade MRT Station on the Thomson-East Coast Line and the popular Parkway Parade shopping mall. It is also next to Roxy Square and the Grand Mercure Roxy Singapore. Other hotels in the vicinity include the Holiday Inn Express Singapore Katong, an IHG Hotel, and the Village Hotel Katong.

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According to Lian, “We believe this sale will boost confidence in the collective sale market as developers continue to pursue attractive land parcels.” He also notes that the Fragrance Group could potentially redevelop Katong Plaza into a new hotel under one of the Accor brands. For those unfamiliar, Accor is a renowned international hotel group that operates a variety of brands, including the popular ibis Budget, ibis Styles, and Mercure. In 2019, Fragrance Group and Accor teamed up to open 13 new ibis Budget hotels, which were previously Fragrance-branded hotels. They also announced plans to bring in the ibis Styles and Mercure brands.

Last month, Fragrance Group, together with its hospitality arm, Global Premium Hotels, signed another agreement with Accor to open two new-build properties with three new hotels by 2027. These include the 808-key Mövenpick Singapore on Hoe Chiang Road, which will be the largest Mövenpick hotel in the Asia Pacific region. Among its many features, it will also house Mövenpick Living Singapore, a 37-key accommodation targeted at travellers seeking extended stays. The other property, located at Waterloo Street, will be a new 502-room hotel under the Handwritten Collection brand of Accor. This will be a redevelopment of the former Min Yuan Apartments, which Fragrance Group acquired en bloc for $141 million in September 2019, and the former Waterloo Apartments, which it acquired in November 2018 for $131.1 million. The two 999-year leasehold sites were amalgamated, and URA approval was obtained for redevelopment into a 500-room hotel.