Chip Eng Seng back in Adelaide
Singapore's Chip Eng Seng has bought a site on Pirie Street in the Adelaide CBD for $14.5 million, which it plans to develop into a hotel.
The acquisition of 51 Pirie Street was from an ownership entity in which Chip Eng Seng chief executive Raymond Chia Lee Meng has a 40 percent stake.
The Adelaide property is one of two Australian projects controlled by Mr Chia's own development business.
Chip Eng Seng signalled its interest in the two assets with Mr Chia's appointment two years ago.
The Pine Street property is a freehold site and has a land size of 1283 square metres.
It is currently occupied by a vacant office building.
"The company intends to demolish the building and redevelop the property into a hotel development," Chip
Eng Seng said in a market statement The Singaporean player is already familiar with the Adelaide's hospitality
market, last year buying the Mercure & Ibis Styles Grosvenor Hotel there for $43 million.
Managed by AccorHotels, that hotel has 245 guestrooms. Chip Eng Seng also has interests in Perth.
The latest Adelaide acquisition comes as the Singaporean player completes its exit from the controversial Tower Melbourne project
In November last year, Chip Eng Seng pulled the plug on the $350-million residential project in the
Melbourne CBD in the face of a lengthy legal battle.
In a complex deal, the Singaporean player sold out of the residential project, alongside its neighbouring landlord
the wealthy Chow family, also based in Singapore.
Cbus Property then secured a $1 billion-plus development opportunity in the heart of the Melbourne CBD, buying out neighbouring properties after the two Singaporean owners put aside their lengthy property dispute and offered their real estate to the market.
Chip Eng Seng said it had completed its sale of the Tower Melbourne site this week.
Article by Nick Lenaghan, originally appeared in Australian Financial Review July 5, 2018