Ong Beng Seng, managing director of Hotel Properties, owns the Formula One Singapore Grand Prix franchise.
COURTESY OF HOCH ZWEI/NEWSCOM
Hotel Properties—controlled by tycoon Ong Beng Seng and his wife Christina—has won government approval to redevelop three of its adjoining prime properties on Orchard Road, Singapore’s main shopping strip, a project that analysts estimate could cost between S$1 billion and S$2 billion ($738 million and $1.5 billion).
The proposed redevelopment of the Forum shopping center, voco Orchard hotel and HPL House will be converted to a mixed-use project comprising a hotel, retail, office and residential components on the properties with a combined land area of 14,027 square meters.
Under the plan, the company will build twin skyscrapers of 64 stories each, along with a 43-story tower, a separate 29-story block, a rooftop garden and a performance theater. The entire project will have a built up space of 114,153 square meters when completed.
“The proposed redevelopment will transform this part of Orchard Road into a vibrant, energetic, significant and prominent precinct,” Hotel Properties said in a regulatory filing. “It will be the focal point to the North West of Orchard Road, a new critical mass of mixed activities, a gateway destination on Orchard Road and provide connectivity between the site and neighboring developments.”
While demand for property remains resilient, it’s unlikely Hotel Properties will rush to undertake the redevelopment, Vijay Natarajan, an analyst at RHB Capital, said. “They may wait for the market to settle down especially on (increased) construction costs and borrowing costs,” he said. The company sank into the red, with a net loss of S$17.2 million in the first six months of the year as finance charges more than doubled to S$46.3 million.
The project will be the largest property redevelopment on Orchard Road, which has recently seen a number of older buildings earmarked for redevelopment as the government aims to rejuvenate the shopping district as a pedestrian friendly and green urban destination. Last year, Indonesian billionaire Sukanto Tanoto’s Pacific Eagle Real Estate bought the nearby Tanglin Shopping Centre for S$868 million, while tycoon Asok Kumar Hiranandani’s Royal Group purchased the Ming Arcade for S$172 million.
Hotel Properties said its professional advisers are still working on detailed plans and the timeline of the project. It is proceeding with the project just weeks after its managing director Ong Beng Seng became embroiled in the Corrupt Practices Investigation Bureau’s ongoing graft investigation involving Transport Minister S. Iswaran. No charges had been filed against Ong, who will continue with his corporate duties at the company.
Ong, whose Hotel Properties has a portfolio of hotels and resorts across 15 countries including the Four Seasons in Singapore and the Maldives, has a current net worth of $1.7 billion that he shares with his wife. He also owns the Formula One Singapore Grand Prix franchise. The contract for the annual night race was extended for another seven years in 2022, the fourth renewal since Ong first brought the marquee event to the Lion City in 2008.