SINGAPORE - Tenants at a 44-year-old 28-storey office tower in the financial district have been told to pack up and leave by year-end as the owners have plans to redevelop the plum site next year.
Some tenants just recently moved in, spending up to S$100,000 on renovations - and are unhappy to be forced out so soon.
Owners of the building, Hub Synergy Point, at the corner of Enggor Street and Anson Road - opposite M Hotel Singapore - sent out notification letters to the building's 30-odd tenants late last month.
After the building is vacated, construction work will begin "soon after" and the new building will be ready by 2020, according to the letter seen by The Straits Times.
The move came as a surprise to some tenants who moved into the building recently.
For instance, local food and beverage firm Prive Group, moved into a 4,500 sq ft office space there just last month and has already spent nearly S$100,000 on renovations.
"It's not just about renovation costs, but the disruption of our business. It takes a lot of effort to move," says Prive Group chairman Yuan Oeij. "But now that this has happened, we just want to make sure we are treated fairly."
Meanwhile, eatery Jiak Kopi Cafe, which also spent more than S$100,000 on renovations in recent months began operations on the ground floor at the end of February.
Cafe owner Mr Kho Long Huat said he would not have renovated had he known about the redevelopment plans when he signed the lease agreement last December.
"We're just a small business," said Mr Kho, who is also the managing director of a construction company. "It's unfortunate that our investment is now going down the drain."
Prive Group is seeking an arrangement with the building owners that is "fair" for both parties, while the eatery's attempts at seeking compensation has been rejected.
The management office declined multiple requests for comment.
Not all tenants, however, were troubled by the redevelopment notice.
The lease agreement includes a clause that states that the landlord has to provide at least four months' notice to terminate the tenancy in the event of any redevelopment plans.
Recruiting company iKas Group, which has been leasing out an office at the building for six years, said it already had plans to move out.
"We've been here for a while and it would be nice to move to a new place," said manager Adam Davies.
Hub Synergy Point came under single ownership in 2015, after a company majority owned by Mr Ho Kian Cheong of Keng Seng Group bought the top three floors for a total of nearly S$30 million.
The company bought the 26th storey for S$9.97 million, or S$2,400 psf, and the 27th and 28th storeys for S$20 million or S$1,512 psf, according to a Business Times report.
Under a single ownership, the building's owner could redevelop the building to maximise its potential value. It is about 250-m from Tanjong Pagar MRT station.
Analysts say motivations behind the redevelopment could be to maximise the land's plot ratio.
Hub Synergy Point is 28 storeys but the maximum height allowed there is 35 storeys, according to the Urban Redevelopment Authority.
Director of real estate agency Chris International, Mr Chris Koh, said another reason could be to rejuvenate the building, which was built in 1973, to attract future tenants.
And with the office rental market expected to be flat this year, it is timely to carry out redevelopment plans now, he added.