SINGAPORE: Some changes could be afoot at Capitol Singapore after it has been hit with a depressed retail environment. Landlord Perennial Real Estate on Friday (Feb 5) said it is looking at ways to help tenants.
CEO of Perennial Real Estate Holdings Pua Seck Guan, said: "The retail sector is not easy now, because a lot of retailers are faced with the problem of labour shortage and also in this volatile market.
“As a landlord, we therefore have to adopt a strategy to find the right tenant and a win-win rental structure, and some of the rentals we may have to get it on a turnover basis rather than insist on a very high base rent."
The announcement comes as Capitol Singapore integrated development is edging closer to completion. The 157-room The Patina hotel has been completed, although it has not yet opened its doors. Meanwhile, the luxury Eden Residences expects to receive its Temporary Occupation License by end-February. The retail complex has been opening in phases since May 2015.
Concerns about Capitol's retail tenants aside, Perennial presented a strong report card for the three months to December at a briefing on Friday, with net profit almost doubling up 93 per cent to S$41.1 million.
Property consultant, Chestertons, said Capitol could get a boost when the hotel starts operating. "One potential catalyst that might come out for Capitol's retail centre would be the opening of Patina Hotel,” said managing director of Chestertons Donald Han.
“The Patina is almost ready to open its doors and it would welcome high-end or business tourists. So effectively, that could be a crowd puller to be able to support some of the high -end offering in Capitol. This year might potentially might see some footfall traffic. I think it might see higher occupancy settling in, as the year moves on. "
Turning to its other Singapore properties, Perennial said it hopes to start selling office space and medical suites at TripleOne Somerset sometime in the second quarter, and it is awaiting final approval to do the same for AXA Tower.
Perennial's other properties in Singapore include Chinatown Point and CHIJMES. The Singapore properties account for 21 per cent of the group's total assets, behind China whichs accounts for around 73 per cent.