Two retail units at Sim Lim Square for sale at $4.56 mil

The buyers’ guided price for both the units at Sim Lim Square is priced at $3,115 psf and $3,118 psf. Comparatively, the sold price for 99-year leasehold commercial units in Jalan Besar stood at $2,560 psf in 2020.

Two retail units situated in the tech hub, Sim Lim Square have been put up for auction through Knight Frank with a guide price of $4.56 million. Situated on Rochor Canal Road in District 7, the 78,152 sq ft development offers 492 commercial units across six floors and two basement levels.

One retail unit measures 581 sq ft, with a guide price of $1.81 million ($3,115 psf), while the other is 882 sq ft, with a guide Senja Close EC price of $2.75 million ($3,118 psf). The two were initially put up for auction on Feb 16 by Knight Frank, but failed to secure a successful bidder.

Nearby, Rochor and Jalan Besar MRT Stations are situated on the Downtown Line, while the Bugis MRT Interchange Station connects the East-West and the Downtown Lines.

Shifts in the retail environment and consumer preferences leaning more towards e-commerce have impacted the mall’s footfall. Additionally, many of the ageing owners of the strata units are planning to retire. As a result, some owners have begun laying the groundwork for a collective sale attempt. Last year, the development launched the first collective sale tender with a reserve price of $1.25 billion, yet it was unsuccessful in attracting a buyer.

An acquisition of the two retail units at Sim Lim Square could provide the new owner with an opportunity to capitalise on a potential en bloc windfall. Both units are currently leased to an entertainment operator, with a three-year lease starting in February and the option to extend for a further three years.

Units at Sim Lim Square boast higher rental rates and rental yields compared to other surrounding properties. Rents hit as high as $15.50 psf per month (pm) based on caveats, with an average of about $9.70 psf pm. The rental yield is approximately 4.7%, higher than other 99-year leasehold commercial developments. For example, the neighbourhing Sim Lim Tower in Jalan Besar recorded an average rental of $4.69 psf pm, with a rental yield of about 2.6%, based on caveats in the past 12 months.

The buyers’ guide price for the two units at Sim Lim Square is Park Hill priced at $3,115 psf and $3,118 psf, while the sold price for 99-year leasehold commercial units in Jalan Besar has been $2,560 psf in 2020.

Rarely presented with an opportunity to acquire two retail units with such potential, purchasers of the units can benefit from both the high returns and a potential future en bloc sale.