S$65 million redevelopment plan proposed.
The Board of Directors of Raffles Medical Group Ltd wishes to announce that Asian HealthCare Capital Management Pte. Ltd. (AHCM), a wholly-owned subsidiary of RMG Capital Pte. Ltd., which in turn is wholly-owned by the Company, has on 13 December 2013 entered into a sale and purchase agreement (SPA) with DBS Bank Ltd. (DBS Bank) to acquire the property at 100 Taman Warna, Singapore 276405 for the purchase consideration of S$54.8 million.
The Purchase Consideration was arrived at on a “willing-buyer and willing-seller” basis, after taking into account current market prices of properties in the vicinity and an assessment of the Property’s redevelopment potential.
A deposit of S$5.48 million, being ten per cent (10%) of the Purchase Consideration, has already been paid by the Company to DBS’s solicitors on 13 December 2013. The balance of the Purchase Consideration will be paid on completion, which is expected to take place on 29 January 2014.
The Purchase Consideration will be satisfied in cash, and funded by a combination of internal resources and bank borrowings.
The Directors believe that the Acquisition is a strategic opportunity for the Company to expand its core business of providing healthcare and medical services. The Property is situated at an attractive location and will provide a good catchment of local and expatriate patients. The Property has a land area of 1,942.3 square meters, and is located at the junction of Taman Warna and Holland Avenue, within the Holland Village residential, shopping, and food and beverage belt. The Property is adjacent to Holland Village MRT Station.
The Property sits on 99-year leasehold land, of which 72 years of tenure remains.
The Company intends to redevelop the Property, through AHCM, into a 5-storey commercial building comprising five (5) above-ground levels, one (1) basement level, and two (2) levels of basement car parks. The proposed Redevelopment will achieve a gross plot ratio of 3.00, which represents a floor area of 62,720 square feet.
Following its Redevelopment, the Company intends to lease approximately 9,000 square feet of space on the first and fifth levels of the Property, for use as outpatient medical and specialist clinics. Additionally, pursuant to the SPA, DBS Bank shall lease 4,500 square feet of space on the first and second levels of the Property for its banking operations. The Company intends to lease out the remaining leasable areas of the Property to retail shops and food and beverage outlets.
It is estimated that the cost of Redevelopment, which comprises, inter alia, construction costs, development premium, stamp duty, property tax and interest expenses, will amount to approximately S$65 million.
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