The auction of the five-star Agora Garden (亞太會館) hotel in Taipei attracted only one buyer, BES Engineering Corp (中華工程), whose majority shareholder owns the property for sale, fueling claims that the hotel was overpriced, a realtor said yesterday.
“It is more than likely Agora is overpriced,” Stanley Su (蘇啟榮), senior researcher at Sinyi Realty Co (信義房屋), Taiwan’s only listed property broker, said by telephone.
“That would explain why there was only one bidder. That the buyer is affiliated with the seller lends further support to my theory,” he said.
The engineering company said price negotiations were still under way and would require final approval from its board of directors and shareholders.
The Core Pacific Group (威京集團), which owns both the hotel and BES Engineering, told local media a day earlier that BES had made an offer higher than the floor price of NT$15 billion (US$463.4 million).
The hotel sits on a 2,468 ping (0.82 hectare) plot of land in Xinyi District (信義) and has 14 floors above ground and four underground. It is being marketed as an ideal site for developing upscale housing units.
Billy Yen (顏炳立), general manager of international real estate consultancy DTZ (戴德梁行), which was commissioned to organize the bidding, said whatever the closing price, the property would prove a bargain years from now in light of the scarcity of land and an expected influx of Chinese capital.
“The local commercial property market is bound to boom on warming cross-strait trade ties,” he said.
Yen said a Hong Kong investor had expressed interest but backed off after the government questioned the legality of the purchase of Nan Shan Life Insurance Co (南山人壽) by a consortium led by Primus Financial Holdings Ltd and Hong Kong-based China Strategic Holdings Ltd (中策集團) earlier this month.
“The implication that Chinese capital pulled the strings behind the [Nan Shan] acquisition scared away the Hong Kong investor,” Yen said.
Su, however, disagreed, saying profitability was investors’ main concern.
The apparent lack of interest in Agora Garden indicates that the nation’s luxury housing market would find it difficult to achieve prices of more than NT$3 million per ping if a luxury housing project is to be rebuilt on the hotel’s site.
Su said that while improving cross-strait trade ties were favorable for the local property market, it was too early to tell what the exact impact would be.
Investors are likely to take a wait-and-see approach, given the huge amount required for the deal, he said.
Meanwhile, Bank SinoPac (永豐銀行) yesterday auctioned off a 721.83 ping plot of land near Chinese Culture University in Taipei to Tonlin Department Store Co (統領百貨) for a record high in the area of NT$628.88 million, or NT$871,200 per ping.
The new buyer outbid three other bidders and closed the land sale at a 50 percent premium on the bank’s asking price of NT$420 million.
Chiu Tai-hsuan (邱太煊), a real estate analyst at Taiwan Realty Co (台灣房屋), estimated that a new housing project to be built at the site was likely to sell for between NT$850,000 and NT$1 million per ping, according to a statement released yesterday.
ADDITIONAL REPORTING BY JOYCE HUANG
ISSUES: Gogoro has been struggling with ballooning losses and was recently embroiled in alleged subsidy fraud, using Chinese-made components instead of locally made parts Gogoro Inc (睿能創意), the nation’s biggest electric scooter maker, yesterday said that its chairman and CEO Horace Luke (陸學森) has resigned amid chronic losses and probes into the company’s alleged involvement in subsidy fraud. The board of directors nominated Reuntex Group (潤泰集團) general counsel Tamon Tseng (曾夢達) as the company’s new chairman, Gogoro said in a statement. Ruentex is Gogoro’s biggest stakeholder. Gogoro Taiwan general manager Henry Chiang (姜家煒) is to serve as acting CEO during the interim period, the statement said. Luke’s departure came as a bombshell yesterday. As a company founder, he has played a key role in pushing for the
China has claimed a breakthrough in developing homegrown chipmaking equipment, an important step in overcoming US sanctions designed to thwart Beijing’s semiconductor goals. State-linked organizations are advised to use a new laser-based immersion lithography machine with a resolution of 65 nanometers or better, the Chinese Ministry of Industry and Information Technology (MIIT) said in an announcement this month. Although the note does not specify the supplier, the spec marks a significant step up from the previous most advanced indigenous equipment — developed by Shanghai Micro Electronics Equipment Group Co (SMEE, 上海微電子) — which stood at about 90 nanometers. MIIT’s claimed advances last
EUROPE ON HOLD: Among a flurry of announcements, Intel said it would postpone new factories in Germany and Poland, but remains committed to its US expansion Intel Corp chief executive officer Pat Gelsinger has landed Amazon.com Inc’s Amazon Web Services (AWS) as a customer for the company’s manufacturing business, potentially bringing work to new plants under construction in the US and boosting his efforts to turn around the embattled chipmaker. Intel and AWS are to coinvest in a custom semiconductor for artificial intelligence computing — what is known as a fabric chip — in a “multiyear, multibillion-dollar framework,” Intel said in a statement on Monday. The work would rely on Intel’s 18A process, an advanced chipmaking technology. Intel shares rose more than 8 percent in late trading after the
GLOBAL ECONOMY: Policymakers have a choice of a small 25 basis-point cut or a bold cut of 50 basis points, which would help the labor market, but might reignite inflation The US Federal Reserve is gearing up to announce its first interest rate cut in more than four years on Wednesday, with policymakers expected to debate how big a move to make less than two months before the US presidential election. Senior officials at the US central bank including Fed Chairman Jerome Powell have in recent weeks indicated that a rate cut is coming this month, as inflation eases toward the bank’s long-term target of two percent, and the labor market continues to cool. The Fed, which has a dual mandate from the US Congress to act independently to ensure