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If they are taking a 25 year view, then they won't go too far out given the "democracy" down under. St****** also took close to 2 decades to redevelop their 1990 purchases into apartments...

"They are land-banking these sites," said one executive, who added the group was able to beat local and international competitors by taking a bet on what Australian property might be worth in 25 years.

Singaporean brothers buy a Sydney tower

SINGAPOREAN billionaires Robert and Philip Ng have upped their exposure to the Australian property market with the purchase of a Sydney tower that takes their local development pipeline to more than $1 billion.

The Ng family's Far East Organisation, the largest private property developer in Singapore, yesterday bought the Ausgrid building on Sydney's George Street for $151.8 million.

The price, as with many of the group's purchases, was higher than expected. The vendor, the NSW government, said the sale freed up funds for essential services and infrastructure.

The Ng brothers, who inherited a property empire from their father Ng Teng Fong, who developed more than 700 hotels, malls and apartment blocks in Singapore and Hong Kong, are worth $US11bn ($12.1bn), according to Forbes magazine.

The magazine valued their private real estate holdings in Far East Organisation at more than $US6bn but their purchases in Australia may leave this figure in need of revision.

In a near unprecedented spree, the brothers have outlaid about $800m on Australian commercial property and hotel businesses in less than a year.

Just two weeks ago, the group bought two Park Street buildings overlooking Sydney's Hyde Park from Kyko Group for $127m.

The site, which includes Kerry Packer's former headquarters, is tipped to be converted to apartments, once tenants such as Bauer Media shift out.

The group bought 227 Elizabeth Street last November for about $143m and is planning a luxury apartment conversion. It also picked up the Clocktower Square in Sydney's Rocks district for $72m from local billionaire Bob Ell, who has been selling to cashed-up Asian groups.

Far East is not constrained to buying office buildings.

Last October, it blew local institutions out of the water with a $205m play for Perth's Harbour Town Centre, and it later made a near $300m offer for Sydney's Harbourside Shopping Centre.

The surge in the family's interest in Australia kicked off last April when its listed hospitality arm, Far East Orchard Limited, struck a deal to invest $225m in well-known hotel and property player Toga Group, adding to its existing local hotel brands.

Those familiar with the Ng family said the company was in no rush to develop its purchases.

"They are land-banking these sites," said one executive, who added the group was able to beat local and international competitors by taking a bet on what Australian property might be worth in 25 years.

The largest part of the Ng family's fortune is held in Tsim Sha Tsui Properties, headed by older brother Robert, in Hong Kong. Philip oversees the Singapore interests, Forbes said. But late last year they picked up a retreat on Scotland Island in Sydney's north that could give them a base from which to oversee their local operations.

NSW Finance and Services Minister Andrew Constance said the sale, brokered by Macquarie Capital, "significantly exceeded" the building's retention value. In a nod to Far East Organisation's ambitions, he said the Ausgrid building had the potential to be converted into a hotel, retail and residential complex.
Far East in it for the long haul
Mercedes Ruehl
538 words
11 Mar 2014
The Australian Financial Review
Copyright 2014. Fairfax Media Management Pty Limited.
In November last year, one of Asia’s biggest developers – relatively unknown in Australian real estate – purchased Yamba, a luxury property on Sydney’s Scotland Island, for $7 million.

It wasn’t the developer’s first Australian purchase. A month earlier, the same developer beat the likes of DEXUS Property Group and other established ­Australian property groups to purchase Harbour Town centre in Perth for $205 million.

Fast forward to March 2014 and now there are few in the property industry that are not familiar with Far East Organization. This is because Singapore’s largest developer has a formidable appetite for Australian real estate. Far East has aggressively and shrewdly purchased high-profile Australian assets worth a combined $800 million in the space of just over five months.

In its latest deal, Far East snared the highly sought after Ausgrid building on Sydney’s George Street for $151.8 million. It followed the purchase of the Clocktower Square and Rendezvous Apartment Hotel complex in Sydney’s The Rocks for $72 million, also in October. In November, the company descended on Valad Property’s 23-storey B-grade office asset at 227 Elizabeth Street, also in Sydney. Far East paid about $143 million for the asset.

In February, Kyko Group sold the former headquarters of Kerry Packer at 50-58 Park Street to Far East in a $127 million transaction.

It reportedly also owns a roughly 14-hectare development site in the Melbourne suburb of Greensborough, although these reports are not confirmed.

Far East, as with many Asian private developers, is intensely private. So far, the company has declined to comment when contacted by The Australian

Financial Review.

The company was established in 1960 by billionaire real estate tycoon Ng Teng Fong, and is now run by his son Philip Ng, following his father’s passing.

As of March 2014, Philip and his brother Robert have a net worth of about $US11 billion ($12.2 billion) after inheriting their father’s empire, according to Forbes. Private real estate holdings through Far East Organization are valued at more than $6 billion and Forbes’ lists the Ng brothers as 106th on their list of ­global billionaires.

But there is a clear theme running through all of Far East’s known investments in Australia to date. Office demand is weak, but the residential apartment and wider development market is very strong. The Ausgrid ­building was regarded as the cream of the crop in terms of residential conversion opportunities in Sydney – many developers and property groups took a tilt for the asset. It is leased to Ausgrid until 2014 and was marketed as a residential ­development play.

Harbour Town has approval for a 31,000 square metre ­redevelopment. It’s a similar story for the Clocktower property, with tenants being given a cheque to move out, presumably to make way for development. Both 227 Elizabeth Street and 50-58 Park Street were B-grade office towers considered to be prime residential conversion assets.

The Yamba retreat, a 7463-metre property on Pittwater’s foreshore, is reportedly going to serve a “corporate use. ”It suggests Far East is in Australia for the longhaul.

Fairfax Media Management Pty Limited

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