A $90M Clarke Quay Shophouse Portfolio Has Hit The Market — With Potential For Up To 450 Hostel Beds

Some commercial property owners in Clarke Quay seem keen to capitalise on the renewed buying interest that has settled as a result of the latest regulatory changes by URA. To catch up, here’s why some Clarke Quay and Beach Road shophouses have become more attractive to investors.

With a greater chance of repositioning existing commercial buildings into hotels, hostels, or serviced apartments, a number of commercial properties in the areas identified by URA are now on the market.

The latest offering is a portfolio of three refurbished shophouses within the Upper Circular Conservation Area. The three properties at 40 Carpenter Street, 38 North Canal Road, and 32 Hongkong Street are located in the Singapore River Planning Area.

They are also within one of the two street blocks identified by URA where new planning permissions for a change of use will be more favourably considered. According to joint marketing agents Cushman & Wakefield (C&W) and CBRE, the buildings for sale could potentially be converted as a new hostel or serviced apartments.

Collectively, the three properties come with a combined guide price of about $90 million, but can also be acquired on an individual basis.

Each building was recently refurbished and will be sold with existing tenancies. According to C&W and CBRE, the location of these buildings typically appeal to tenants such as professional services firms, family offices and F&B and lifestyle operators.

The proximity to Clarke Quay, Chinatown and the wider CBD also boosts the area’s overall retail footfall. The properties are close to four MRT stations: Clarke Quay on the North East Line, Chinatown interchange on the North East and Downtown Lines, Raffles Place interchange on the North South and East West Lines, and Telok Ayer on the Downtown Line.

In addition, their 99-year leasehold tenures were recently renewed: 

• 40 Carpenter Street from 31 May 2024
• 38 North Canal Road from 31 January 2024
• 32 Hongkong Street from 29 September 2023

Each property has about 96 years left on their lease. All three are zoned ‘Commercial’ with a plot ratio of 4.2 under the 2025 Master Plan.

Relaxed regulations now work in the sellers’ favour

For over a decade, URA generally did not approve new hotels, backpackers’ hostels or serviced apartments within the Singapore River Planning Area, wary of short-stay accommodation crowding out the F&B, retail and professional-services tenants that give conservation districts like this one their character.

That stance has now been relaxed, and a pilot scheme lasting two years until May 2028 covers selected blocks that include Upper Circular Road, Carpenter Street, Hongkong Street and part of North Canal Road. These are the same streets that the portfolio of properties for sale are on.

URA has said the change is intended to reduce compliance friction and support greater vibrancy in the area, and framed it as part of a wider review of planning rules rather than a permanent reversal.

Clemence Lee, Executive Director of Capital Markets at CBRE, says that the owner of the portfolio of properties has already commissioned consultants to study the conversion potential, with current plans pointing to about 450 beds across the three buildings under a backpacker or student hostel format, subject to approvals.

Alternatively, the buildings could be repositioned into boutique hotels or serviced apartments, which usually come with larger room sizes compared to hostels.

Meanwhile, Sophia Lim, Director of Capital Markets at C&W, frames the opportunity to acquire this portfolio as a first-mover opportunity to acquire newly refurbished, turnkey assets in a precinct where stock like this rarely comes to market.

She points to the combination of fresh 99-year leases and completed A&A works that will give the new owner “long-term tenure security, resilient income, and future value-add creation through repositioning opportunities”.

The three shophouses are priced within a tight band

Based on its gross floor area (GFA) of 7,012 sq ft, the $22.4 million guide price for 40 Carpenter Street works out to about $3,200 psf.

Meanwhile, the $44.4 million guide price for 38 North Canal Road translates to $3,100 psf over its total GFA of 14,322 sq ft.

Finally, 32 Hongkong Street has a GFA of 7,211 sq ft which means its $22.35 million guide price is about $3,100 psf.

Overall, the guide price of $89.15 million for the entire portfolio of properties works out to roughly $3,120 psf across the combined GFA of 28,545 sq ft.

In terms of land area, the smallest site (40 Carpenter Street at 1,669 sq ft) and the largest (38 North Canal Road at 3,320 sq ft, almost double the size) are only about 3% apart on a $PSF basis. 

It suggests that the guide prices are broadly consistent across the three properties for sale, rather than priced individually. But it doesn’t alter the fact that 38 North Canal Road commands nearly double the asking price compared to either of the other properties. This will be a consideration for buyers who are not keen on acquiring the complete portfolio.

The clearest recent comparable is a 99-year leasehold shophouse on North Canal Road that changed hands in December 2025 for $23.89 million, based on URA caveats. This is in the same range as the individual guide prices for 32 Hongkong Street and 40 Carpenter Street. 

The lease of that shophouse on North Canal Road also starts from 2014, so it carries a remaining land tenure broadly similar to this portfolio’s.

However, two earlier transactions on the same two streets sold for far less: $9.6 million for a Hongkong Street shophouse in April 2023, and $14.38 million for a larger North Canal Road site in March 2022.

Although the tenure on both plots of land dates back to 1951 and 1941 respectively, leaving only around 18 to 27 years on their original 99-year lease at the time of sale — well short of the roughly 96 years on this portfolio’s freshly topped-up leases. This could explain the wider price gap.

Shophouse properties in the neighbouring Boat Quay conservation area along Circular Road are held on much longer 999-year leases, and transactions have ranged from $9.5 million to $16.8 million since 2021.

It is also worth noting that the Hongkong Street sale fell in the same month the Additional Buyer’s Stamp Duty (ABSD) for foreigners buying residential property was raised to 60%, a jump that may have begun steering some foreign capital that would otherwise go into private homes toward commercial assets instead.

Commercial properties, including this portfolio of shophouses, are not subject to ABSD or seller’s stamp duty (SSD), and foreigners and corporate entities are eligible to purchase.

Set against the closer, tenure-matched comparables on North Canal Road and Hongkong Street, this portfolio’s pricing lines up with the one recent transaction that shares a comparably fresh lease, and sits well above what shophouses with only a couple of decades left on their leases have fetched.

Muted sales volume in the shophouse market

The sale of these shophouses in Clarke quay comes as the volume of transactions has moderated, broadly speaking. Just 13 shophouse deals were caveated in the first quarter of 2026 for a combined sales value of $88 million, according to data by PropNex Research.

That is the weakest quarterly showing since the second quarter of 1998, with the gulf in price expectation between buyers and sellers one of the key reasons for the muted sales.

Against that backdrop, the relaxed planning stance by URA is expected to positively influence the demand for shophouses in this specific precinct. Whether it is enough to draw bids at close to $90 million, in a market where deal volumes have thinned to a 28-year low, remains to be seen.

The EOI exercise for this portfolio of three refurbished commercial buildings closes on Aug 18.