A UNIT of Frasers Centrepoint Limited is paying S$203.4 million for Capri by Fraser, Changi City.
The price translates to nearly S$650,000 per room for the 313-room “hotel residence” – or a serviced apartment- hotel hybrid – which is on land with a balance lease term of about 54 years.
The 12-storey property is being sold by Ascendas Frasers Pte Ltd, an equal joint venture between Ascendas Land (Singapore) and Frasers Centrepoint.
Market watchers say it is just a matter of time before Frasers Centrepoint offers the asset to its sponsored trust, Frasers Hospitality Trust (FHT). The property was listed in FHT’s prospectus in June 2014 as part of the future acquisition pipeline for the trust under a right of first refusal arrangement with Frasers Centrepoint, which is the trust’s sponsor.
Capri by Fraser, Changi City opened in 2012. Its 313 studios (ranging from 32 square metres to 70 sq m) are equipped with kitchenettes.
The hotel residence is part of a mixed development located next to Expo MRT Station and within Changi Business Park that Frasers Centrepoint developed jointly with Ascendas on a 4.7 hectare site that the partnership clinched at a tender in 2008 conducted by JTC Corporation.
The two bagged the 60-year leasehold land parcel for S$150.8 million or S$119 per square foot per plot ratio.
The mixed development also includes One@Changi City, comprising about 650,000 sq ft of net lettable area of business park space spanning nine levels, and the Changi City Point mall.
The project’s hotel residence component was Frasers Centrepoint’s first Capri property and cost S$124 million to develop, according to an article in May 2012.
In term of the S$650,000 per room pricing, Donald Han, managing director of property consulting group Chestertons, said the price is reflective of the market – taking into account the location, tenure and the fact that the performance of the property has stabilised since it has been trading for a few years.
“I would expect yield to be 6-plus per cent before it is offered to Frasers Hospitality Trust,” he said.