Heeton Holdings sells iLiv@Grange for $95 million

iLiv@Grange, a 30-unit project by Heeton Holdings, was completed in 2013. Its asking price was about $110-$120 million last year.
iLiv@Grange, a 30-unit project by Heeton Holdings, was completed in 2013. Its asking price was about $110-$120 million last year.PHOTO: THE BUSINESS TIMES

Buyers offered viable exit option in weak residential property market, says company

Heeton Holdings has sold its upmarket iLiv@Grange condominium off Orchard Road en bloc in a deal that values the property at $95 million.

The disposal, which Heeton announced late on Friday along with a profit warning for the third quarter, was made through a sale of shares in Heeton Residence, the sole shareholder of Heeton Realty, the owner of iLiv@Grange.

The price - which works out to $1,623 per square foot on net saleable area - is lower than its asking price of $110 million to $120 million last year. The company had tried to sell the Grange Road property en bloc on two previous occasions, initially asking for $129 million to $135 million in late 2013.

The sale was to a group of Singaporean private investors and came as the project was due to incur its second Qualifying Certificate sales deadline this month.

Heeton had not sold any of the 30 units at the 16-storey project, which was completed in October 2013.

"The residential property market is not recovering due to various factors, including property cooling measures, supply of new units to the market and the general macroeconomic conditions," Heeton said on Friday. "Given current market conditions, the consideration offered by the purchasers for Heeton Residence seemed reasonable and offered a viable exit option for the company."


iLiv@Grange, a 30-unit project by Heeton Holdings, was completed in 2013. Its asking price was about $110-$120 million last year. PHOTO: THE BUSINESS TIMES

The price for the condo includes a nominal amount of $4 for the purchase of the sale shares and $21 million for the transfer of the shareholders' loan owing from Heeton Residences to Heeton. As part of the complex transaction, Heeton also subscribed for $4 million senior notes in Heeton Realty, which bears interest at 5 per cent per year.

Heeton had bought the 20,325 sq ft site - the former Grange Court - for $72.8 million in 2007.

iLiv@Grange comprises mostly two- and three-bedroom apartments. Balconies, planter boxes and air-conditioner ledges make up a good 30 per cent of saleable floor area, market watchers noted.

Heeton also announced last Friday that it expects a loss for the third quarter to Sept 30, primarily due to losses from the disposal of Heeton Residence.

SLUGGISH MARKET

The residential property market is not recovering due to various factors, including property cooling measures, supply of new units to the market and the general macroeconomic conditions.

HEETON HOLDINGS, on the reasons it sold its property at a lower price.

It had total debt of $369.26 million, and cash and cash equivalents of $11.17 million at June 30.

A similar bulk transaction was struck in August when 10 bungalows on Pearl Island in Sentosa Cove were sold for $120 million to $130 million to a company owned by the co-founders of Evia Real Estate.

"There is money out there hunting for assets, and in the current low interest rate environment, some yield-hungry investors may be prepared to pay fairly high prices for certain assets," said Mr Nicholas Mak, SLP International executive director.

A version of this article appeared in the print edition of The Straits Times on October 06, 2016, with the headline 'Heeton Holdings sells iLiv@Grange for $95 million'. Print Edition | Subscribe