The tender submitted by United Venture Development to acquire a residential site at Orchard Boulevard has been approved by the Urban Redevelopment Authority (URA) on Feb 21. United Venture had submitted the tender on Feb 1 to acquire the site for $428.3 million.
United Venture is a 20:80 joint venture company (JVCo) formed by Singapore Land Group U06 ’s (SingLand) wholly-owned subsidiary, Singland Residential Development, and UOL Venture Investments, a wholly-owned subsidiary of UOL Group. Under the JV, Singland Residential has two ordinary shares - or 20% of the total share capital - in the JVCo while UOL Venture Investments has the remaining eight shares.
The site spans a land area of 7,031.40 sqm (75,685 sq ft) and is on a 99-year lease. The site is licensed for mixed-use - residential with a commercial area on the first floor. The non-residential component will form part of the common property for the development.
The site has a plot ratio of 3.5 with a maximum building height of 36 storeys. The site’s permissible gross floor area (GFA) is 24,610 sqm with a max of 24,210 sqm for the residential portion and a minimum of 400 sqm for the commercial segment. The JV will be able to build an estimated 296 units on the site.
According to SingLand’s filing on Feb 21, the tender bid will enable the group to replenish its land bank for residential developments in Singapore. The JV with UOL will enable SingLand to take mitigate more risks and take on more projects to diversify its property portfolio, it adds. Furthermore, SingLand will be able to tap on UOL’s expertise and network.
Under the terms of the tender, the JVCo have already paid a deposit of 5% of the tender price on Feb 1. It will pay 25% of the tender price (including the 5% deposit) within 28 days of Feb 21 (or the day of the award of the tender). The balance of 75% will be paid within 90 days of the award of the tender. The tender price will come from bank borrowings and shareholders’ loans.
Interested person transaction
The transaction is deemed to be an interested person transaction (IPT) according to the Singapore Exchange S68 ’s (SGX) listing rules as UOL holds a 50.37% stake in SingLand.
The JV with UOL Venture Investments, being UOL’s subsidiary, is also deemed an IPT.
Wee Ee Lim is the chairman and a director of SingLand. He is also the deputy chairman and a director of UOL. Liam Wee Sin is a director of both SingLand and UOL. Liam is also the group chief executive of UOL.
Shares in Singapore Land Group closed one cent lower or 0.55% down at $1.80 while shares in UOL Group closed five cents higher or 0.81% up at $6.26, on Feb 21.
