Second Chance Properties is looking to dispose its property at Lucky Plaza, #01-56/57/58/59 304 Orchard Road, for a total consideration of $13.4 million.
On June 29, the group announced that its subsidiary, Better Chance Properties (BCP), granted the buyer Lew Chee Beng the option to purchase.
The sale price was arrived at on a willing-buyer and a willing-seller basis after taking into consideration the valuation performed by Colliers International Consultancy & Valuation (Singapore) on August 31, 2021, and was to be satisfied in cash.
The sale price of $13.4 million is $1.8 million above the valuation performed by Colliers International Consultancy & Valuation (Singapore) on August, 31 2021.
According to the group, the popularity of Lucky Plaza as a mall has declined due to the influx of domestic foreign workers crowding the mall every Sunday and as such, many local shoppers avoid patronising it.
Lucky Plaza is highly dependent on foreign tourists for shopping and due to Covid-19, rentals here have reduced drastically to almost half from pre-Covid levels. It is therefore uncertain whether the rental can revert to pre-pandemic levels in the near future.
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Therefore, when the company received an unsolicited offer to sell the freehold property, management was of the view that it was a good opportunity as well as a prudent business decision for the company to sell off its property and utilise the proceeds to reduce the debts of the group.
Earnings adjusted for the proposed disposal stands at $11.4 million, as compared to $9.8 million before the proposed disposal.
Earnings per share (EPS) adjusted for the proposed disposal stands at $1.51, as compared to $1.30 before the proposed disposal.
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Shares in Second Chance are trading at 0.5 cents up and 2.22% higher at 23 cents on June 29.
Photo: The Edge Singapore
