[SINGAPORE] National postal service provider Singapore Post (SingPost) has put up 10 Housing & Development Board (HDB) shophouses for sale and leaseback under its plan to divest non-core assets.
These properties, distributed across the HDB heartlands, are expected to fetch S$50 million in total, The Business Times understands. The Teban Gardens Road shophouse has the lowest asking price of S$2.4 million, and the one in Bedok North, the highest at S$7.1 million.
Gross yields for these HDB shophouses, with a total strata area of 21,118.77 square feet, range from 4.32 to 4.98 per cent per annum.
SingPost is the anchor tenant for 90.8 per cent of the space in these shophouses, with the remaining being leased out to external parties.
A spokesperson for the national postal service provider said in response to queries from BT on Thursday (Jun 19): “SingPost is initiating the divestment of 10 HDB shophouses across Singapore, in keeping with the group’s plan to divest non-core assets. Plans are for a sale-and-leaseback model to maintain current post office services.”
She only provided the 10 locations of these shophouses, and did not address the other queries on whether this was the first such sale-and-leaseback transaction, whether the proceeds would be paid out as dividends, and the number of remaining post offices in its network.
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SingPost has proposed a special dividend of S$0.09 a share for FY2025, and plans to pay this from a portion of the proceeds from the divestment of its Australian logistics business earlier this year.
The company’s website indicated that SingPost has a network of 42 post offices, including the 10 located in the shophouses being marketed for sale. SingPost has shuttered about a dozen in recent years amid a secular decline of the sector.
All its post offices are located in properties formerly owned by the Singapore Land Authority (SLA), and are sited on the ground floor of HDB shophouses or other commercial setups such as malls.
Of these, the group owns more than half the properties occupied by the post offices – specifically, all those housed in former SLA premises and the majority of the HDB shophouses. Most of them are carried as property, plant and equipment on its books and generally recorded at cost, based on information shared at an analyst briefing last November.
The 10 shophouses, which are being marketed by CBRE, form the majority, if not all, of SingPost properties located in HDB blocks, going by the post office locations listed on the SingPost website.
The post office network has been unprofitable in recent years, posting S$14.4 million in operating losses for FY2025 ended March. The figure for FY2024 was a negative S$14.5 million.
SingPost announced in 2024 that it would divest non-core assets and businesses, including the retail-commercial mixed development SingPost Centre, which was earlier valued at S$1.1 billion. This is to unlock value for shareholders.
The sale-and-leaseback of the HDB shophouses would likely result in profit for the company from the valuation uplift and cash inflows upon divesting the real estate.
The portfolio will be offered for sale via an expression-of-interest exercise that closes at 3 pm on Jul 30. Investors may buy the individual properties, one of the two clusters of five shophouses or the entire portfolio.
There are only around 8,500 HDB shop spaces available for private ownership, and the public housing developer is no longer releasing such properties for sale.
SingPost shares closed 0.9 per cent or S$0.005 up at S$0.57 on Thursday.
