Key Takeaways
- • IOI Properties Group Bhd is in exclusive talks to acquire Singapore's Chijmes and the nearby Capitol Kempinski hotel, according to Bloomberg, while planning a private property fund initially comprising office assets valued at about S$6 billion.
- • The Capitol Kempinski hotel had been marketed for about S$600 million (about RM1.9 billion), per people familiar with the matter cited by Bloomberg; Chijmes was valued at S$379 million at end-2025. Neither figure is an agreed purchase price.
- • The proposed private fund is expected to be established within two months, with an initial portfolio of South Beach's office component and IOI Central Boulevard Towers, a target IRR of 10% to 11%, six-monthly distributions, and a minimum investment of about S$500 million with a five- to seven-year lock-up.
- • Former Pimco Prime Real Estate executive Varun Singh has been tapped to oversee the fund; the group intends to eventually list the vehicle as a REIT.
- • Net debt stood at roughly 85% of equity as at end-June, and CEO Lee Yeow Seng aims to reduce gearing to 30% to 50% over three to five years.
Summary
IOI Properties Group Bhd is in exclusive talks to acquire Singapore's Chijmes, a heritage retail and dining complex in a former Catholic convent in the civic district, and the adjacent Capitol Kempinski hotel, according to Bloomberg. Group CEO Lee Yeow Seng said due diligence is underway but declined to disclose the purchase consideration. Bloomberg, citing people familiar with the matter, reported that the Capitol Kempinski had been marketed for about S$600 million (about RM1.9 billion). Chijmes was valued at S$379 million at end-2025. Neither figure represents an agreed purchase consideration. Singapore developer Perennial Holdings controls about one-third of Chijmes and 80% of Capitol Singapore, which includes the hotel, a retail mall and residential units. Other investors include a vehicle backed by an unnamed Southeast Asian sovereign wealth fund. Perennial did not respond to Bloomberg's request for comment.
Lee said IOI aims to introduce high-end fashion retailers at Chijmes to improve tenant mix and rental income, which he said had been constrained by the complex's concentration of food and beverage outlets. If the hotel acquisition proceeds, the group also wants to bring in an international ultra-luxury hotel brand to replace Kempinski.
The acquisitions coincide with IOI's plan to establish a private real estate investment fund to bring outside capital into its Singapore commercial portfolio. Lee told Bloomberg the fund is expected to be set up within two months and would initially hold two office assets valued at roughly S$6 billion combined: the office component of South Beach and IOI Central Boulevard Towers in the central business district. Former Pimco Prime Real Estate executive Varun Singh has been appointed to oversee it. The group has approached prospective investors including private equity firms, sovereign wealth funds and insurance companies, though it did not name them. The fund targets a 10% to 11% internal rate of return with six-monthly distributions. IOI would reduce its stake in the initial assets to about 50%, with minimum investments of about S$500 million and a five- to seven-year lock-up. Over time, additional Singapore properties would be injected, with a longer-term aim of listing the vehicle as a REIT.
IOI's Singapore expansion has lifted borrowings, with net debt at approximately 85% of equity as at end-June, per Bloomberg. Lee aims to bring gearing down to between 30% and 50% over the next three to five years. Recent Singapore acquisitions include City Developments Ltd's stake in South Beach, which would give full ownership, and the Asia Square Tower 2 office building. IOI has also submitted, jointly with a CapitaLand Investment-managed vehicle, an expression of interest to acquire 100% of One Raffles Place on a proposed 50:50 basis, according to an Oct 12 Bursa Malaysia filing report. OUE REIT, the majority owner, said on Oct 8 that no binding sale agreement had been executed. Separately, IOI announced on Oct 1 a conditional agreement to acquire Shenton 101 Pte Ltd, owner of Shenton House, from Lee for a nominal S$1, with the group to settle S$217.06 million in shareholder advances and consolidate S$376.23 million of borrowings upon completion, figures stated as at July 31, 2026.
Lee said IOI aims to introduce high-end fashion retailers at Chijmes to improve tenant mix and rental income, which he said had been constrained by the complex's concentration of food and beverage outlets. If the hotel acquisition proceeds, the group also wants to bring in an international ultra-luxury hotel brand to replace Kempinski.
The acquisitions coincide with IOI's plan to establish a private real estate investment fund to bring outside capital into its Singapore commercial portfolio. Lee told Bloomberg the fund is expected to be set up within two months and would initially hold two office assets valued at roughly S$6 billion combined: the office component of South Beach and IOI Central Boulevard Towers in the central business district. Former Pimco Prime Real Estate executive Varun Singh has been appointed to oversee it. The group has approached prospective investors including private equity firms, sovereign wealth funds and insurance companies, though it did not name them. The fund targets a 10% to 11% internal rate of return with six-monthly distributions. IOI would reduce its stake in the initial assets to about 50%, with minimum investments of about S$500 million and a five- to seven-year lock-up. Over time, additional Singapore properties would be injected, with a longer-term aim of listing the vehicle as a REIT.
IOI's Singapore expansion has lifted borrowings, with net debt at approximately 85% of equity as at end-June, per Bloomberg. Lee aims to bring gearing down to between 30% and 50% over the next three to five years. Recent Singapore acquisitions include City Developments Ltd's stake in South Beach, which would give full ownership, and the Asia Square Tower 2 office building. IOI has also submitted, jointly with a CapitaLand Investment-managed vehicle, an expression of interest to acquire 100% of One Raffles Place on a proposed 50:50 basis, according to an Oct 12 Bursa Malaysia filing report. OUE REIT, the majority owner, said on Oct 8 that no binding sale agreement had been executed. Separately, IOI announced on Oct 1 a conditional agreement to acquire Shenton 101 Pte Ltd, owner of Shenton House, from Lee for a nominal S$1, with the group to settle S$217.06 million in shareholder advances and consolidate S$376.23 million of borrowings upon completion, figures stated as at July 31, 2026.
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