Hongkong Street shophouse with hotel and restaurant tenants on the market for $35 mil

The Singapore Grand Prix 2023 had a positive effect on hotels of all price ranges. Along Hongkong Street, many boutique hotels saw high occupancies, with some running at full capacity. This includes Fragrance Hotel Riverside, at 20 Hongkong Street, Bluewaters Pods Hotel at 38 Hongkong Street, Hotel Nuve Elements at 41 Hongkong Street, and Hotel Bencoolen at 47 Hongkong Street.

To enhance the experience of travelers staying nearby, the street also offers many bars and restaurants. This includes a cocktail bar at 28 Hongkong Street, which was voted one of Asia’s 50 best bars in 2023. Other restaurants in the area include a Greek restaurant Vios by Blu Kouzina at 31 Hongkong Street, Italian restaurant Amo at 33 Hongkong Street, Korean bistro bar Soollounge2 at 38 Hongkong Street, and Japanese restaurant Mizume at 41 Hongkong Street.

The Singapore Grand Prix 2023 also provided a boost to the surrounding area of Hongkong Street. Located off New Bridge Road, it is just a few minutes away from Clarke Quay MRT station and Clarke Quay Central Mall. These areas, combined with the Core CBD, Chinatown, and Marina Bay, make it highly attractive to visitors.

The area’s popularity has been further enhanced by the rejuvenation of many of its buildings. This has included the 3-year $5 million retrofit of 41 Hongkong Street, that was completed in October 2019. The renovation involved the installation of a lift to each floor, as well as a 6-storey rear extension. As the property sits within the Upper Circular Conservation Area, strict conservation guidelines were followed.

The property is now zoned for commercial use with a plot ratio of 4.2, and is currently offering a temporary occupation permit. It was leased to the 30-room Hotel Nuve Elements, while Japanese restaurant Mizume took up the ground floor unit. An open terrace was turned into a nursery selling plants, and a rooftop terrace was made into a spa with a jacuzzi for the hotel’s visitors.

The owners of 41 Hongkong Street are currently hoping to capture some of the rising interest in properties near the Singapore Grand Prix, and have put the property up for sale. The sale is by expression of interest, with an asking price of $35 million, that translates to $3,945 psf based upon the built-up area.

This comes soon after 18 Hongkong Street, and 17 Hongkong Street were put on the market. 18 Hongkong Street was purchased for $9.6 million, and is currently being leased for a 7-year hostel operation. 17 Hongkon Street is a freehold property, with a current asking price of $47.5 million, which translates to $5,975 psf based upon the floor area.

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Given the premium for freehold property, 41 Hongkong Street is likely to attract shophouse and hotel investors. Family offices are potential buyers, as the property could be converted into a single office building in the future. As selllers become more realistic with their asking prices, buyers who felt that the prices of some shophouses had been driven up to unreasonable levels are now returning.