HOTEL Properties Limited (HPL), the real estate player owned by tycoon Ong Beng Seng, will focus on developing its assets and holdings after exiting a Temasek-backed consortium that owns Paragon real estate investment trust (Reit), among other assets.
“Hotel Properties Limited, Tiga Stars’ parent company, plans to focus its resources on the development of its other assets and project,” said the company on Jan 24.
The filing disclosed that HPL’s subsidiary Tiga Stars had ceased to hold any shareholdings in Cuscaden Peak. While Cuscaden Peak has a deemed interest of 61.51 per cent in Paragon Reit, this means that HPL no longer owns any interest in the Reit.
The amount that HPL received for its stake is not known.
The Cuscaden Peak consortium was formed with three partners; namely HPL’s Tiga Stars, CLA Real Estate’s Adenium and a Mapletree Investments’ subsidiary Mapletree Fortress.
In 2022, Cuscaden Peak had acquired the property business of then-listed Singapore Press Holdings, which included its stake in SPH Reit. SPH Reit was renamed Paragon Reit with effect from Jan 3, 2023.
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However, it is believed that HPL has been keen to focus on the properties in its own portfolio.
A majority of HPL’s properties are situated in the Orchard Road belt. Closer to Dhoby Ghaut is the Concorde Hotel and Shopping Mall, where it acquired the remaining stakes it did not own last November. HPL paid S$821 million.
At the Tanglin stretch of Orchard Road, HPL owns properties such as Forum The Shopping Mall, voco Orchard Singapore and HPL House.
Investors have paid more attention to HPL ever since it was announced in August 2023 that it had received in-principle approval for the entire site to be redeveloped into a massive mixed-use redevelopment.
Spanning 114,153.38 square metres, the mixed-use project will have a hotel, as well as residential units across two tower buildings. It will also have retail and office space.
But there is competition. Around these sites, other properties are being redeveloped. Ming Arcade is being developed by the Royal Group. Not far from it, the Tanglin Shopping Centre is being redeveloped by Pacific Eagle Real Estate. Opposite Paragon, Ngee Ann City is undergoing asset enhancement. (*See amendment note)
Earlier this week, Cuscaden Peak made an offer to take Paragon Reit private by way of a trust scheme of arrangement.
The offeror is looking to acquire all units in the Reit held by unitholders other than Cuscaden Peak and its subsidiaries at S$0.98 apiece. The offer values the Reit at S$2.8 billion.
Apart from Paragon Reit, there are other property assets in Cuscaden Peak, analysts said.
Cuscaden Peak is now owned 50:50 by CLA Real Estate and Mapletree.
*Amendment note: The article has been amended to indicate that Tanglin Shopping Centre is being redeveloped by Pacific Eagle Real Estate.
