A corner terraced plant located on 14, Kaki Bukit View is for sale through the expression of interest (EOI) exercise that has an estimated price at $9.2 million. The single-user five-storey factory covers an area of 8,570 square feet that is classified to Business 2 or heavy industrial usage with the gross plot ratio being 2.0. The land is subject to the benefit of a 60-year lease that began on July 9th 1996. Thus, there are approximately 33 years left in the lease.
The factory is constructed over an area of 17,136 sq ft and comes with the cargo lift and distinct passenger lift. The facility also has parking that can hold up to eight vehicles. The first level has a ceiling of 6m. The upper floor have a ceiling of 4.5m.
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An property title search reveals that the property is part of Barn & Potter, the producer of home-grown aromatherapy and beauty-care retailer Hysses. Hysses had previously operated as Mt Sapola up to the point that Cheryl Gan, who co-founded the company with a Thai-based company partner. She decided to branch independently and redesign the Singapore business as Hysses in the year 2017. She now manages the operations as director at Hysses and Barn & Potter.
The headquarters of the companies is the 37th floor of Kaki Bukit View, a four-storey terraced industrial property only a few feet across from the fourteen Kaki Bukit View. Gan bought the former in the month of December and then moved into the company’s previous premises at Tai Seng. Two years after, Gan acquired 14 Kaki Bukit View in February 2022. He began using the building for storage space for Hysses and Barn and Potter.
Food factory approved for use
After purchasing the property, Gan decided to submit an application for approval to change the purpose of the property’s usage to a food manufacturing. “I thought about going into F&B and I thought that the factory could be an ideal location to begin this business idea,” she explains.
Written consent was granted by URA for the change in usage earlier in the year, explains Haden Hee who is a PropNex Realty realtor who has been assigned to sell the 14 Kaki Bukit View. He explains that obtaining this approval is not an easy task due to the fact that the property isn’t in a food zone that is already in place and approvals are required from a variety of authorities like URA and the Singapore Food Agency (SFA) and the Land Transport Authority, and the Public Utilities Board, among other authorities. “If any of the organizations refuses to grant approval then you won’t be allowed to move forward. The stars have to align in a certain way,” he adds.
Due to the long administrative process, it took nearly an entire year to secure the permission in writing. In the meantime Gan’s priorities have changed to accommodate the fact that Hysses continues to expand. In October, the brand has opened their flagship shop in the Kampong Glam region, which consists of two shophouses that are back-to-back at 56 Haji Lane and 87 Arab Street. The leasehold shophouses with 999 years of lease were purchased by the company in Sept. 2021. $6.7 million. The store is designed to be an interactive retail store that showcases Hysses their products and the their philosophy The store is a major shift from Hysses’ other stores situated in shopping malls. “With Haji Lane, we had the freedom to be more creative with our marketing and advertising. Haji Lane store we were able to have the freedom and room to communicate the story of our brand more widely,” Gan reflects.
She’s currently looking for a sale to the 14 Kaki Bukit View, with the profits possible channelled into more bricks and mortar stores that could be used as a way to connect with customers on a personal level for the brand.
Gan anticipates that approval for food manufacturing to enhance the appeal of the property to prospective buyers. Hee is in agreement, pointing out that as Singapore intensifies its efforts to complete their “30 to 30” food security program that aims to produce 30% of its nutrition needs manufactured in the country by 2030. the demand for food factories is still robust. He anticipates high interest from both consumers working in the food industry as well investors who want to lease the property to these tenants.
In order to finalize the change in use and to obtain the SFA license required by food producers and food manufacturers, certain work needs to be completed at the plant to meet standards such as the fitting of grease filters as well as exhaust pipes. If negotiations are made with the new owner, Gan is open to carrying out the work prior to transfer of the property and allowing the next owner to be able to set up a food processing facility.
Hee says that the asking price of the 14-acre Kaki Bukit View that amounts to $1,074 per square feet in relation to the land area and is an appealing proposition when compared with other properties recently sold within the area. In the month of May the five-storey intermediate terraced factory located at five Kaki Bukit Place was put on the market for sale at an estimate that was $5.35 million and $1,116 per square foot for its land area of 4,795 square feet. In May the month of May, an industrial property located at 34 Kaki Bukit Place was sold for $9 million, or $1,297 per sq ft in the area of land. In June the month of June, an industrial property located at 40 Kaki Bukit Crescent changed hands for $9.05 million or $1,342 per square foot in the land area.
The possibility of conversion into a worker’s dormitories
Another advantage of The property is its location it is 3 minutes walk from Kaki Bukit MRT Station on the Downtown Line. Hee believes that this closeness to public transportation also creates the 14 Kaki Bukit View an ideal property to be converted to a dormitory for workers.
Presently, URA allows up to 49% of the floor space of industrial properties in certain areas to be used for workers in dormitories. In the case of 14 Kaki Bukit View Hee claims this can approximately translate into up around 80 beds subject to the appropriate approvals.
The utilization of the property to serve as workers’ housing is not a valid reason to use it as a food manufacturing facility as per URA as well as SFA guidelines, he says. He considers this to be an appealing option for other companies. “Rents for dorms in central areas have risen to $750 per month. With 80 beds, the owner could make a rent revenue of $56,000 a month while keeping that remaining% part of their building to use for their primary use.”
The EOI application to apply for the 14th Kaki Bukit View is scheduled to be closed on the 4th of September.