Investment in Coffee shops ?
Jul 2, 2011
Six coffee shops sold for nearly $60m
Hefty price tag may be due to stable return on investment: Analysts
By Huang Lijie & Danson Cheong
SIX coffee shops have sold for an eye-popping price tag of nearly $60 million - showing how popular this form of dining has become for Singaporeans.
Analysts told The Straits Times it is a pricey deal as coffee shops usually command about $4 million to $5 million.
They said the $57.3 million tag may be due to the stable return on investments this type of venue can offer because of its long-term popularity with diners.
However, diners should not be affected - at least for now - as the stallholders are still paying the same rent and most of their rental agreements are not due to expire soon. But they may need to pay more when the agreements are up for renewal.
All six coffee shops were put up for sale at the same time by property investor Peter Koh to three buyers who are said to be newcomers to the business.
The most expensive, a 13-stall outlet in Bukit Batok Street 11, sold for $14.5 million while two others in Tampines and Yishun fetched more than $10 million each.