Roxy-Pacific to buy Dragon Mansion in en bloc deal

ROXY-PACIFIC Holdings has signed an agreement to buy Dragon Mansion for $100.8 million via a collective sale – some 16 per cent below the owners’ previous asking price of $120 million when the property was first put up for sale in July.

However, the deal is conditional upon obtaining agreement from an 80 per cent majority of the owners on the purchase price. BT understands that a fresh round of agreements have to be obtained as the price offered by Roxy-Pacific is below the owners’ reserve price in the collective sale agreement.

When the tender for the collective sale of Dragon Mansion was launched in July, it marked the first collective sale offering of the year. If Roxy-Pacific buys the freehold site for $100.8 million, it will be paying $863 per square foot per plot ratio (psf ppr) including an estimated development charge of about $400,000. The owners’ original asking price, on the other hand, translated to about $1,020 psf ppr including the development charge.

The site has a land area of about 42,000 sq ft and it is designated for residential use with a plot ratio of 2.8.

Roxy-Pacific chief executive Teo Hong Lim said that the company inked the deal to buy the site as he ‘found the price reasonable’.

The developer, which was listed on the Singapore Exchange (SGX) in 2008, is looking to replenish its land bank after launching a number of projects over the past year. It recently acquired two freehold sites – one at Joo Chiat Place and the other at Tembeling Road. Said Mr Teo: ‘We are constantly on the lookout for new sites, but the price and location have to be right.’

The company took part in recent government tenders for the sale of state land, but it was ‘too competitive’, Mr Teo said. Recent tenders for government residential land sites have drawn 12-15 bids each.

The acquisition will be fully funded through proceeds from the company’s initial public offering (IPO), internal funds and/or bank borrowings, Roxy-Pacific said in a statement. The acquisition is not expected to have any material effect on the net tangible assets per share or earnings per share of the company for the current financial year.