S$61.8m offer for AA Centre too low

by Cheryl Tay

Starlite Land Development, a unit of Far East Organization (FEO), has proposed to buy AA Centre (pictured) — which has served as the headquarters of the Automobile Association of Singapore (AAS) since 1967 — for S$61.8 million, reported The Straits Times.

However, the offer was far below the indicative price set for the property when it sought expression of interest (EOI) in June. In fact, AAS was expecting an offer of between S$90 million to S$100 million.

Starlite's offer translates to around S$1,100 psf based on the building's 55,574 sq ft area owned by the association, or around S$1,830 psf on the plot's size.

Lee Wai Mun, Chief Executive of AAS, said the move to sell the building was attributed to the need for the association to expand its activities and serve its 83,000 members better."We need to move on," added Lee.

While in favour of the sale, Sia Cheong Yew, an AAS member, said the offer price is not enough.

"The difference between the indicative and offer price is huge," he noted, adding that "property prices have not changed drastically since mid-year."

On 9 January, the association will hold an extraordinary meeting to decide on whether it will accept Starlite's offer.Cheryl Tay, Editor of CommericalGuru, wrote this story. To contact her about this or other stories, email cheryltay@allproperty.com.sg

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