Perennial-SPH Group sells half of shares in Former AXA Tower to Alibaba Group

A consortium led by Perennial Real Estate will divest half a stake in the Grade A office building AXA Tower to Chinese e-commerce giant Alibaba Group in Singapore, which is leasing the property. this property, before redevelopment of it. The Group will also transfer half of an outstanding shareholders' loan to Alibaba Singapore, the developer said on Wednesday (May 6), without disclosing the size of the loan.

New Launch project is located 8 Shenton Way in the Central Business District, is a 50-storey grade-A office development with a retail podium, according to Perennial. Former AXA Tower is brand new condominium located in District 01. The 118,230 sq ft (site area) parcel of land will become our gateway to our future in living, entertaining, working and green spaces. The key to this massive growth is the expansion of Singapore's green lung. Well-connected to the new Pasir Panjang Linear Park with Marina Bay. Along this road, ecological corridors will converge - the 10km Southern Ridges between Kent Ridge Park and Harbourfront, the 36km Rail Corridor running west to northeast, and the West Coast Park, 'Play Center In The West'.

New launch project: Former AXA Tower with facade

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New Launch project has an existing gross floor area of 1.05 million sq ft, and has secured regulatory approval from the Urban Redevelopment Authority to further increase its floor area to 1.55 million sq ft to integrate hotel and residential usage under the CBD Incentive Scheme.

The consideration payable for the 50 per cent equity interest will be calculated based on the net asset value of Perennial Shenton Holding (PSHPL) - which indirectly owns AXA Tower - at the deal's close, and based on an agreed property value of $1.68 billion. Meanwhile, the consideration for the loan will be 50 per cent of the principal outstanding as at closing.

New Launch project is expected to be completed in June, after which Alibaba Singapore and Perennial Newco, a newly formed unit of the consortium, will form a joint venture to redevelop the building.

“Alibaba is already an anchor tenant at AXA Tower, and we are pleased to have their support in creating an iconic landmark in Singapore’s CBD,” said Perennial CEO Pua Seck Guan.

New launch project: Former AXA Tower by Alibaba Group and Perennial-SPH

Wednesday’s announcement will provide a confidence boost to the Singapore market and reaffirm investor appetite for CBD assets, said JLL, a real estate management firm engaged by Alibaba Singapore for the AXA Tower deal.

“Amid ongoing market uncertainty related to the COVID-19 pandemic, technology and e-commerce companies have become essential providers of goods and services across the region,” said Ms Regina Lim, head of Asia Pacific capital markets research at JLL.

“As a result of increased demand for their services and strong capital positions, they have remained active in their expansion and investment plans, with global gateway cities like Singapore proving an attractive destination for deployment.”

Source: The Straittimes

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