Local supermarket operator Sheng Siong Group has agreed to purchase a portfolio of properties at Siglap V and Toa Payoh for a total consideration of $48.5 million. The portfolio, currently owned by investment holding company Jelita Property, is being sold by Hong Kong-based retail company DFI Retail Group (DFI).
The sale, which was handled by exclusive advisor JLL, was announced in April this year. At the time, the guide prices for the eight units at Siglap V and the Toa Payoh unit were $32 million and $16.5 million respectively. This translated to approximately $3,012 per square foot for Siglap V and $1,696 per square foot for the Toa Payoh unit.
The final sale price agreed upon by Sheng Siong is $1.7 million above the combined guide price from April. The transaction is expected to be completed on October 30.
In a recent filing to the Singapore Exchange, Sheng Siong revealed that it has entered into a conditional sale and purchase agreement to acquire Jelita Property. As part of the acquisition, Sheng Siong will lease all eight strata units at Siglap V to DFI through a leaseback arrangement.
According to JLL, the eight retail units at Siglap V have a combined strata area of approximately 10,624 square feet. The units, situated on the ground floor, are currently leased to CS Fresh and Guardian. CS Fresh, a 24-hour grocery retailer, occupies nearly 90% of the space (9,418 square feet) across seven of the eight amalgamated units. The remaining unit, measuring 1,206 square feet, is occupied by Guardian.
The Toa Payoh property is located on the ground floor of a commercial HDB block and has a remaining tenure of approximately 47 years. The full 9,731 square feet unit is currently occupied by Giant Supermarket, which announced earlier this month that it will be closing its outlet by the end of September. This brings the total number of Giant outlets in Singapore down to 45 from 54 at the beginning of the year.
The sale is a significant move for Sheng Siong, as it marks its first acquisition of commercial properties in Singapore. The supermarket operator is known for its presence in heartland areas and suburban neighbourhoods, with outlets mainly located within HDB estates.
Overall, this acquisition is expected to strengthen Sheng Siong’s market presence and increase its revenue streams in the long run.