Key Takeaways
- • IOI Properties Group, led by CEO Lee Yeow Seng, is in exclusive talks and due diligence to buy Chijmes and the Capitol Kempinski hotel in Singapore, a combined deal reported at about $979 million.
- • Perennial Holdings has been marketing the Kempinski hotel at about $600 million, according to sources, and Chijmes was valued at $379 million at the end of 2025.
- • IOI's commercial portfolio in Singapore has grown to about $10 billion, funded by debt, with net debt at 85% of equity as of end-June.
- • Lee is courting investors for a private fund starting with two assets totalling $6 billion, targeting a 10%-11% internal rate of return and a five- to seven-year lock-up with minimum commitments of about $500 million.
- • The fund is intended to ease IOI's leverage, which Lee aims to reduce to 30%-50% of equity over three to five years.
Summary
Malaysian property tycoon Lee Yeow Seng, chief executive of IOI Properties Group, is in exclusive talks and due diligence to acquire Chijmes, a retail venue inside a former convent in Singapore's civic district, and the nearby Capitol Kempinski hotel, according to an interview Lee gave to Bloomberg. He declined to disclose the value of a final agreement. The Straits Times headline cites a combined figure of $979 million. Perennial Holdings, which controls about a third of Chijmes and about 80% of Capitol Singapore, has been trying to sell the Kempinski hotel, which sources said was being marketed for about $600 million. Chijmes was valued at $379 million at the end of 2025. A vehicle backed by an unnamed South-east Asian sovereign wealth fund holds a minority stake in both assets, per corporate records.
IOI's debt-funded acquisitions have contributed to a record year for Singapore real estate deals. The firm gained full control of South Beach after buying the majority stake from City Developments, and recently acquired Asia Square Tower 2, bringing Lee's commercial portfolio to $10 billion. IOI is also seeking a joint venture with CapitaLand Investment to buy One Raffles Place, whose majority owner OUE REIT confirmed in October it is in exclusive discussions on a potential sale. Net debt rose to 85% of equity as of end-June. Lee said he aims to reduce net debt to 30%-50% of equity within three to five years, even as a planned Malaysia REIT listing is expected to raise gearing further.
Lee plans to set up a private fund within two months, overseen by former Pimco Prime Real Estate executive Varun Singh. The vehicle will initially hold two assets totalling $6 billion: the office portion of South Beach and IOI Central Boulevard Towers. Lee said the fund has courted private equity firms, sovereign wealth funds and insurers without naming them. It targets a 10%-11% internal rate of return with semi-annual distributions, and IOI plans to reduce its stake to about half. Investors would need minimum holdings of about $500 million with a five- to seven-year lock-up, with a possible later listing as a REIT.
IOI's other Singapore bets have faced setbacks. Its luxury residential project with 683 homes has sold only about 15 units, exposing the firm to a higher tax, which Lee said has been deferred to next April while it continues to appeal. Lee attributed the weak sales to a 60% levy on most foreign purchases introduced in 2023 and said the company is pivoting toward renting to expatriates. He said Chijmes rents are depressed by a concentration of food and beverage outlets and that IOI plans to bring in high-end fashion brands and a global ultra-luxury hotel brand to replace the Kempinski. Perennial did not respond to requests for comment. Lee said lenders and the board remain supportive.
IOI's debt-funded acquisitions have contributed to a record year for Singapore real estate deals. The firm gained full control of South Beach after buying the majority stake from City Developments, and recently acquired Asia Square Tower 2, bringing Lee's commercial portfolio to $10 billion. IOI is also seeking a joint venture with CapitaLand Investment to buy One Raffles Place, whose majority owner OUE REIT confirmed in October it is in exclusive discussions on a potential sale. Net debt rose to 85% of equity as of end-June. Lee said he aims to reduce net debt to 30%-50% of equity within three to five years, even as a planned Malaysia REIT listing is expected to raise gearing further.
Lee plans to set up a private fund within two months, overseen by former Pimco Prime Real Estate executive Varun Singh. The vehicle will initially hold two assets totalling $6 billion: the office portion of South Beach and IOI Central Boulevard Towers. Lee said the fund has courted private equity firms, sovereign wealth funds and insurers without naming them. It targets a 10%-11% internal rate of return with semi-annual distributions, and IOI plans to reduce its stake to about half. Investors would need minimum holdings of about $500 million with a five- to seven-year lock-up, with a possible later listing as a REIT.
IOI's other Singapore bets have faced setbacks. Its luxury residential project with 683 homes has sold only about 15 units, exposing the firm to a higher tax, which Lee said has been deferred to next April while it continues to appeal. Lee attributed the weak sales to a 60% levy on most foreign purchases introduced in 2023 and said the company is pivoting toward renting to expatriates. He said Chijmes rents are depressed by a concentration of food and beverage outlets and that IOI plans to bring in high-end fashion brands and a global ultra-luxury hotel brand to replace the Kempinski. Perennial did not respond to requests for comment. Lee said lenders and the board remain supportive.
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