Is Gallery Hotel on the market?

Source : Business Times - 01 Jul 2008

THE Gallery Hotel in the River Valley area - the first ‘funky’ hotel in Singapore when it opened in 2000 - could go on the market soon, sources say.

BT understands that the hotel’s owner has been talking to several parties with a view to appointing an agent to market the property.

But when contacted by BT, the chief executive of The Gallery Hotel Pte Ltd Ted Ngo said: ‘At this moment, as far as I am concerned, there is no plan to sell Gallery Hotel or to appoint a marketing agent.’

The Gallery Hotel Pte Ltd, which manages the 223-room freehold hotel, is a fully-owned subsidiary of Robertson Quay Investment Pte Ltd (RQI) which owns the property.

Mr Ngo is also a director of RQI and his family is the company’s controlling shareholder. Other RQI shareholders include the Ang and Lim families.

Industry observers polled by BT estimated a wide range of prices for the property at Robertson Quay - from around $450,000 to $900,000 per room. This translates to an absolute price range of about $100 million to $200 million.

Mr Ngo said that the hotel’s average room rate so far this year is above $200, an improvement from almost $180 achieved last year, which was higher than the 2006 rate of close to $150.

He did not deny that there has been interest in the hotel.

‘I have been getting unsolicited enquiries from all sorts of people since the passing away of my father (Ngo Kheng Hoon) in September 2006,’ he said. ‘I presume someone must be very keen to acquire our property and he is very persistent.

‘Speaking on a personal basis, I don’t see any reason why Gallery Hotel should be on the market. We are doing very well. Singapore is a hot spot for tourism. Our shareholders are getting fantastically good returns compared to just a few years ago. It is hard to get similar returns from other sources these days.’

The property was originally known as Gallery Evason Hotel when it opened in September 2000 but the Evason name was dropped in January 2002 when Six Senses Hotels, Resorts and Spas, owner of the Evason brand and manager the hotel, dropped out.

A property consultant said: ‘There is scope to add value to the property by refurbishing and repositioning it, which would create some upside for an investor. Because the hotel can be sold without an ongoing management contract, the asset may be more appealing to potential investors, who will be free to manage the hotel themselves or appoint an established hotel chain to operate it for them.’