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

Champions Way Condo is a 7-block, 12-storey residential complex with a commercial component. The complex offers a variety of units ranging from 2 to 5 bedrooms, making it suitable for both singles and families. The commercial area includes a supermarket, a childcare centre, and a retail centre. Champions Way Condo provides a convenient lifestyle with all amenities in close proximity.

The Singapore Grand Prix 2023 benefitted not only the upscale hotels but also budget hotels. Along Hongkong Street, many boutique hotels also enjoyed high occupancies, with some fully booked, such as 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.

Situated off New Bridge Road, Hongkong Street is three minutes away from Clarke Quay MRT station and Clarke Quay Central Mall, and a short walk to the conversation of restaurants, bars and clubs at Clarke Quay, Robertson Quay and Boat Quay along the Singapore River, with The Core CBD, Chinatown and Marina Bay right nearby.

Bars and restaurants have also significantly benefited from the Grand Prix. 28 Hongkong Street is home to a cocktail bar that was voted one of Asia’s 50 best bars in 2023. Greek restaurant Vios by Blu Kouzina is 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 Tourism Board statistics show the average room rate increased 25.2% year-on-year (y-o-y) to $275.21, with an average occupancy rate at 80.09%, also up 10.7% y-o-y. Room rates across all hotel categories have risen in post-Covid recovery, evident in the shophouse owners at 41 Hongkong Street, who are hoping to take advantage of the investor interest. The property is offered for sale by expression of interest, closing on November 9th, and Brilliance Capital is the exclusive marketing agent.

Upper Circular Secondary Settlement
Hongkong Street, located in the Upper Circular Conservation Area, is considered a Secondary Settlement, which developed between the 1900s and 1960s around the city centre. Unlike the shophouses within the Historic Districts, which have strict conservation guidelines, dwellings in Secondary Settlements have greater redevelopment flexibility, in particular the option to add a six-storey rear extension with a retained front façade.

The owners of 41 Hongkong Street invested $5 million in a major retrofit three years ago, installing a lift to each floor and the six-storey rear extension. The property, which enjoys a 99-year lease from December 2018 and is zoned for commercial use with a plot ratio of 4.2, has received planning permission for hotel use on the upper floors and F&B use on the ground floor.

Readying for sale in April, the shophouse at 18 Hongkong Street was sold for $9.6 million, sitting on a 1,884 sq ft site with a 99-year lease from 1951. The four-storey building with a gross floor area of 5,074 sq ft was bought at $1,892 psf. It had been leased to City Backpackers @ Clarke Quay for seven years, a planning permission that was due to expire in 2024.

17 Hongkong Street, offered for sale in September, is a freehold shophouse sitting on a 1,793 sq ft land area and with a total built-up area of 7,950 sq ft. The ground floor is leased to Japanese omakase restaurant Kappo Shunsui, with the upper floors leased as offices to businesses of different trades, and as such, offered at $47.5 million, or $5,975 psf based on floor area.

The shophouse at 41 Hongkong Street is likely to attract both shophouse and hotel investors, possibly even family offices who could convert it into a single office building in the future. Brilliance Capital’s Sammi Lim states genuine buyers are returning to the market and prices are becoming more realistic, hoping to bridge the price gap between leasehold and freehold properties.