PROPERTY developer Hong Fok Corporation, through its wholly owned subsidiary Super Homes, has acquired five ground-floor units at International Building for S$27.8 million.
With the acquisition, Hong Fok now owns all units in the 12-storey commercial development, as well as the location and potential of the properties, it said in a bourse filing on Wednesday (Dec 4).
The group said the five units were bought from two third-party vendors on a 999-year lease which started on Jan 1, 1971.
The total price tag of S$27.8 million was arrived at on a willing-buyer and willing-seller basis after considering various commercial factors, said Hong Fok. This includes the fact that its subsidiary, Yat Yuen Hong Company, owns a full stake in the freehold lot on which International Building stands.
Located at Orchard Road, the building spans a site area of 5,056.9 square metres (sq m) with a gross floor area of 31,182.38 sq m. It is an office building with two levels of retail space.
An aggregate sum representing 1 per cent of the purchase consideration, or around S$278,000 with goods and services tax where applicable, has been paid to the two sellers.
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Another 5 per cent of the sum, excluding the option money of about S$1.1 million, was paid on Wednesday upon the exercise of the options. This amount will be held by the sellers’ solicitors until the completion of the acquisition, which is expected to take place in February 2025, said Hong Fok.
Upon completion of the acquisition, which will be subject to various legal requirements, the remaining 95 per cent of the price, or S$26.4 million, will be paid to both sellers.
The acquisition will be funded through both internal resources and external borrowings, said the property developer. It does not expect the proposed acquisition to have any material impact on the net tangible assets and earnings per share of the company and group for the current financial year ending Dec 31, 2024.
Shares of Hong Fok closed flat at S$0.83 on Wednesday, prior to the announcement.
