Tung Lok unit renews Orchard Central lease for one year

TUNG Lok Xihe Restaurant (TLXH), a 60 per cent owned subsidiary of Catalist-listed Tung Lok Restaurants, has renewed the lease of its tenancy agreement in Orchard Central for a year, Tung Lok Restaurants said in a bourse filing on Tuesday.

The two units leased, which are located on the seventh floor of the mall and occupy a floor area of 3,444.48 square feet, will continue to be used as the premises for the Dancing Crab restaurant.

The estimated rental fees payable during the renewal is about S$300,000, while the estimated value of the renewal to the company - based on its effective equity interest in TLXH - is about S$180,000.

This represents 1.2 per cent of the group's latest audited net tangible assets, which stood at about S$15.0 million as at March 31, 2019.

The rental rates of the renewal were arrived at after negotiation between the parties, and are computed based on a combination of fixed rates and percentage of the gross monthly sales turnover generated from the premises, Tung Lok said.

It added that the terms of the renewal were supported by an independent valuation report from Teho Property Consultants dated Dec 16, 2019, which was of the opinion that the rental value was within the reasonable range of the prevailing market rental as at Dec 5.

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Shares of Tung Lok Restaurants closed flat on Tuesday at S$0.14.