AW & Sons Capital, a low-profile boutique developer and family office, has bought 10 contiguous freehold shophouses along Teck Chye Terrace, just off Upper Serangoon Road, for S$39 million.

The company already owns the remaining five shophouses in the same row.

Under the Urban Redevelopment Authority’s Master Plan 2019, all 15 shophouses are on land zoned for residential use. The plot ratio (ratio of maximum gross floor area to land area) is 3.0.

Aw & Sons Capital is understood to be mulling redeveloping the entire block of 15 shophouses into a serviced apartment or co-living project.

The price it paid for its latest acquisition of Nos. 19 to 37 Teck Chye Terrace works out to about S$1,008 per square foot per plot ratio, inclusive of an estimated development charge of S$14.35 million payable to the state.

The shophouses were sold by four individuals.

The existing approved use of the two-storey shophouses is commercial on the first storey and residential on the second, said Cushman & Wakefield (C&W), which brokered the sale through a private treaty deal.

Sitting on 17,644 sq ft land area, the 10 units are fully leased, with tenancies expiring at various times up to 2022.

The street-level units are occupied mainly by food-and-beverage operators; the upper-level ones are residences.

The Business Times understands that the current annual rental income from the 10 shophouses reflects about 3.3 per cent gross yield based on the purchase price.

C&W said Aw & Sons Capital has the option to either keep the 10 shop-houses as an investment property – given that they are fully leased – or to redevelop the land into a brand new residential project.

The boutique developer had, in 2015, bought the five adjoining shophouses (Nos. 9 to 17) for S$14.63 million, it has been reported.

If the company were to combine the land for the 15 shophouses, and then also secure approval from the state to buy five remnant land parcels (totalling about 12,500 sq ft) bordering the property, it could have an amalgamated land area of more than 40,000 sq ft.

The resulting gross floor area from a redevelopment would be slightly above 100,000 sq ft, said C&W.

Teck Chye Terrace is near Serangoon MRT interchange station, Kovan MRT station, Heartland Mall-Kovan and Nex mall.

C&W noted that developers remain on the lookout for residential redevelopment sites, especially those near amenities such as key transportation nodes and suburban malls. Residences in such locales remain highly sought after by owner-occupiers and investors.

Shaun Poh, executive director of capital markets at C&W, said: “There may also be a possibility of converting the redevelopment into serviced apartments or co-living units, subject to approval from the authorities.

He noted that, given that the site is near a number of international schools – International French School, Stamford American International School, DPS International School and Hillside World Academy – and the lack of serviced apartments and co-living units in the area, there will be “thriving demand” for such accommodations there.

Aw & Sons Capital, managed by Aw Chye Wee and his son Josh Hu, is under the ambit of the Aw & Sons Group, which originally developed projects in Singapore’s prime districts, namely Jervois Mansions and Nassimville.

Its current portfolio of properties includes The Offshore, a commercial property along North Canal Road, and Hotel Soloha (formerly known as Chinatown Hotel), a new art-centric boutique hotel in the Keong Saik neighbourhood.

Aw & Sons Group was set up by the senior Aw’s father, Aw Kim Chen, who diversified the original rubber business into a property company.

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