LHN Group has entered into the option to purchase for the sale and purchase of the 115 Geylang Property on April 28, for a consideration of $13.5 million.

The property, which will house 30 units on a land size spanning up to 305.6 sqm, is located at 115 Geylang Road.

The option to purchase binds the sale and purchase agreement upon its execution.

The agreement was signed by Emerald Properties, an indirect wholly-owned subsidiary of LHN Group, with CES Capital Holdings, an independent third party.

The deposit of $675,000 has already been paid to CES Capital Holdings, while the balance of $12.8 million is to be paid on the date of completion.

Want our latest Singapore corporate news stories for FREE

Follow our Telegram, Facebook for the latest updates round the clock

The consideration will be funded by internal funds and bank borrowings.

SEE:LHN Group to launch mixed-use development with communal living experiences

The sale is subject to the occupation agreements, where the property will be sold without the benefit of the agreement should any of the agreements be “terminated by effluxion of time” or “terminated by the respective occupier or CES Capital”.

Emerald Properties shall accept vacant possession of the property and is not entitled to make or raise any objections in terms of damage claims or remedies.

If the existing occupation agreement is terminated prior to completion, CES Capital will notify Emerald Properties within 10 business days of the transaction.

The existing occupation agreement is for a term of three years from Nov 15, 2020, without any option to renew.

The monthly rentals under the agreement are: $28,350 per month for the first year, $29,925 per month for the second year and $31,500 per month for the third year, and the deposit that is paid by the tenant is S$63,000.

The agreement may be terminated by the tenant with three months’ written notice, or six months’ written notice from the landlord.

Prior to this agreement, for the financial years ended 30 September 2019 and 2020, the monthly rental paid by the tenant between Oct 1, 2018 and Nov 14, 2020 for the 115 Geylang Property was $31,500 per month.

Shares in LHN closed 0.5 cent lower or 2.1% down at 23 cents on April 28.