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LREIT secures S$10m tender to rejuvenate Somerset area
LENDLEASE Global Commercial Reit (LREIT) on Saturday announced that it has won a tender to redevelop the 48,200 sq ft car park near 313@somerset into a new multi-functional event space.
With the inclusion of the Grange Road car park space, 313@somerset’s net lettable area will expand to approximately 330,000 sq ft, anchoring the Somerset area, said the manager in a statement.
LREIT's latest project is estimated to cost around S$10 million and will be funded via its working capital, which is spread throughout the development phase, said the manager.
The development cost accounts for less than 1 per cent of LREIT’s total deposited property value, and is within the 10 per cent regulatory limit on property development for REITs. There is no impact on gearing, said the manager. LREIT’s gearing ratio was approximately 36 per cent as at March 31, below the leverage limit of 50 per cent for REITs.
Set to be operational in the second quarter of 2022, the new concept at Somerset, designed by DP Architects, will include multiple event spaces, an independent cinema, hawker stalls, and a food-and-beverage attraction.
"This will provide a rich array of events and experiences for locals and tourists, especially the millennials," said the manager.
LREIT will collaborate with Live Nation, a global live entertainment company, to create a calendar of concerts, film and events to ensure that the site is active all year round. It will also work with local independent cinema operator The Projector, and Museum of Food. Museum of Food aims to roll out an "experiential attraction" for locals and tourists to enjoy local cuisine, said the manager.
It further noted that the "strong government support" in rejuvenating Orchard Road was an important consideration for the manager to invest in the site and complement Discovery Walk, a precinct linked to 313@somerset. LREIT will also work with stakeholders and community groups to use the space for a variety of curated events.
The tender was jointly awarded by the Singapore Land Authority, Singapore Tourism Board and Urban Redevelopment Authority. It has an initial tenancy term of three years, which may be renewed for a further two tenancy terms of three years each, and a final tenancy term not exceeding 364 days.
The manager noted that the bid was awarded using the "price-quality method", which took into consideration the quality of the proposal to strengthen Orchard Road’s position as an innovative lifestyle destination, in particular, enhancing the offerings in the Somerset area.
Kelvin Chow, chief executive officer of the manager, said: “We envision this space to provide a differentiated lifestyle experience for locals and tourists alike. A well-curated space will have complementary effects on 313@somerset, which also seeks to continue to improve its experiential and omni-channel retail offerings."