LHN was awarded the former Bukit Timah Fire Station site to develop a mixed-use project with 60 serviced apartment units on levels 2 & 3, and a ground floor commercial F&B and retail operation. Refurbishment capex is estimated at around SGD7m. Meanwhile, LHN is also teaming up with Ching Chiat Kwong (CEO of SGX-listed Oxley Holdings) and his son in a
50:50% JV partnership to acquire Wilmer Place. LHN will invest up to SGD24m for its share of the Wilmer venture. Maybank IB leaves unchanged on its forecasts and TP of SGD0.45 (pegged at 8x FY24E P/E) for now. BUY.
Co-living within a community node
The 0.86-ha Upper Bukit Timah site will be developed into a mixed-use development, featuring co-living and open space for the public, which serves as a key community node for both the Rail Corridor and the surrounding precinct. Expected to open in 1H25, this latest project comes after two successful mixed-use projects with ground level F&B offerings (Coliwoo 450 SR & Coliwoo Balestier). Maybank IB views, the Bukit Timah project should capitalise on LHN’s expertise and synergy across its business units in co-living, commercial and facility management.
New acquisition with prominent JV partner
LHN is setting up a 50:50% JV company with local real estate businessman Mr. Ching Chiat Kwong and his son. The house said it understands the JV company is looking to acquire Wilmer Place located at 50 Armenian Street next to City Hall MRT. The office building could remain as a commercial building or be re-purposed for co-living business. With a land area of 710.7sqm, the leasehold building has a tenure of 99 years from 1 May 1947. This should enable the group to expand its co-living offerings under its space optimization business segment.
Healthy project pipeline
LHN has 6 upcoming projects, including the Ministry of Health (MOH) hostel for 700 nursing professionals. LHN is offering commercial paper of up to SGD5m, at a 6% interest rate, to fund the capex for its MOH contracts and other general working purposes. MOH has also proposed 11 additional sites (including one brownfield and 10 greenfield sites). Other re-rating catalysts are successful wins of more MOH/SLA tenders, as well as further capital recycling initiatives.
