Heeton / Lian Beng / KSH

Heeton / Lian Beng / KSH: Local construction and property developers Heeton, Lian Beng and KSH have teamed up to jointly develop a two-component mixed use asset worth A$150m in Fortitude Valley, Brisbane, Australia. The land was bought for A$5.5m in July 2014. The residential component is a 30-storey tower consisting 187 apartment units, co-developed by Australian counterpart Marvel Investments, which holds a 67% stake, and the JV-consortium Wickham 186 (55% Heeton, Lian Beng 30%, KSH 15%), which holds a 33% stake. The property will be marketed to investors in Singapore, Malaysia, Indonesia and Hong Kong. The hotel component is fully owned by Heeton and Lian Beng, with effective interest of 70% and 30% respectively. Upon completion in 2016/17, the 23-storey tower set in the heart of popular tourist destination spots will contribute 198 room keys. According to “Brisbane City Plan 2014”, Fortitude Valley, which lies immediately northeast of the Brisbane CBD, is slated for development and transformation into a major entertainment, cultural, heritage, retail and business centre. Furthermore, the hotel development is in line with the state government plans of doubling overnight visitor expenditure by 2020, which translates to about 450 more rooms per year. RevPAR in Brisbane has been increasing at 10.2% over five years to 2012. Management from the three companies expressed optimism and excitement in the venture, though it is the maiden investment in Australia for all three. There is a growing trend of small local developers seeking overseas opportunities as the Singapore private property market softens. Heeton is unrated, Lian Beng has 2 buy and 1 hold ratings, and KSH has 2 buy ratings.