The Business Times - November 26, 2003
Having a flagship piece of real estate used to be the pride and joy of many companies, but increasingly, these properties are being put on the market. And high-profile names feature prominently in the divestment game. 'We've seen this happening for a while now,' said Kim Eng research head Seah Hiang Hong. 'Previously, companies thought there were capital gains to be had, besides buying property for their own use. But the scenario has changed with the property market being depressed for so long.'
Singapore Telecommunications is putting its exchange site in Old Holland Road up for tender, while media giant Singapore Press Holdings has sold its historic Times House site to Marco Polo Developments for $118.88 million.
Fashion retailer FJ Benjamin, too, is looking for buyers for its prime Orange Grove Road headquarters.TT International, which makes consumer electronic products under the Akira brand, let go of its flagship TT International Tradepark in Toh Guan Road to Ascendas Real Estate Investment Trust (A-Reit) for $92 million. In turn, TT is leasing back the property for 10 years.
Osim and Ultro Technologies also entered into sale-and-lease-back agreements with A-Reit for their name-bearing properties.
'Previously, companies bought property out of security, afraid that they may one day get booted out when rents rise,' says DTZ Debenham Tie Leung executive director Ong Choon Fah. 'But with rents being soft now and the proliferation of sale-and-lease-back agreements, there is no such fear.'
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