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FRASERS Centrepoint has emerged as the highest bidder for the freehold Far East Mansion at Kim Yam Road and has started inking a collective sale deal with the majority owners to buy their 136,194-sq-ft freehold site off River Valley Road for about $256 million, according to sources. This works out to $674 psf of potential gross floor area, including an estimated development charge of $885,689.

Building plan: The Far East Mansion site may be redeveloped into a 36-storey condominium

The breakeven cost for a new condo on the site, which is near the Singapore Buddhist Lodge, could be around $1,050 psf, say market watchers. The site may be redeveloped into a new 36-storey condominium with about 280 units averaging 1,350 sq ft.

The site is zoned for residential use with a 2.8 plot ratio and 36 storeys.

Far East Mansion was marketed through an expressions of interest exercise handled by CB Richard Ellis. It is understood to have drawn three bids when it closed at the end of last month, the highest from Frasers Centrepoint.

Based on the $256 million price, owners of Far East Mansion's existing 218 units will collect $1.17 million per unit - which is about 70 to 80 per cent more than what their homes would have fetched if sold individually.

Far East Mansion, which is more than 30 years old, comprises four 14-storey blocks.

It will be Frasers Centrepoint's second major property acquisition in the area over the past year.

In August 2005, the property arm of listed Fraser & Neave bought a 139,842-sq-ft site at St Thomas Walk from CK Tang chairman Tang Wee Sung and his younger brother Wee Kit.

Frasers Centrepoint paid $210 million for the freehold plot, which translates to a land price of $601 per sq ft of potential gross floor area inclusive of an estimated development charge of $25.5 million.

The company's other major property acquisitions this year include SingTel's former warehouse site at West Coast Road and Waterfront View, facing Bedok Reservoir, which it is buying jointly with Far East Organization for $385 million.