Hotel Grand Central

[propertyinvestor]

How about HPL compare to HGC and St******?

how about compare to LC Development ?

[paullow]

hpl deep stock. lots of hotel n shop holdings in orchard rd. immense redelopm potential. that's its crown jewel. not including its other ppty n biz elsewhere.

[Temperament]

At what price (P/E) is fair to good value for HPL?

[paullow]

not sure what price is good value for hpl. but the truth is its orchard assets already worth nearly $5/share, as reported in the papers recently by some analysts. i won't be surprised if the sum of its parts is ard $10.(but i have to
quality that I did not open its books and physically add it up)

ong beng seng's unrealised wealth would then not be that far off from the late Ng TF's.

in any case, it's a deep stock, ideal for people who can afford the wait.

[propertyinvestor]

So how did HPL drop to 40cents back then? How did SC Global drop to 30cents back then?

[paullow]

i doubt that sort of thing would happen to hpl again if it did before. if it does, it could be another great financial crisis thing.

[Temperament]

i doubt that sort of thing would happen to hpl again if it did before. if it does, it could be another great financial crisis thing.

Yes, relatively speaking it is the same as asking why SPH was only $2.30 during one of the the day in Mar 2009. Of course there were a lot other "Blue to Blue-Black counters at ridiculous/unbelievable very low price at Sept 11 2001, AFC., Sars, GFC. etc.....
If only we dare to buy at those times. Even you have the capital you will always think twice. Some even think Thrice.

NB:
i had bought some SPH @ $2.50 during MAR 2009. And many more other stocks. Yet i had chickened out finally. i had held back 40% to 50% of my investable fund. i just couldn't bear anymore as fear had taken over me without me even realising it at those times. And i called myself a "cycle trader". Shame on me! Well that's an example of human psychology, called "FEAR" - Which i think i can overcome but not truly enough to make me buy more during those frightening times of market's extreme excesses. i suppose the same thing will happen to me again. It's O. K. as long as over-all i still make some profit.
That's human.

[portuser]

Greengiraffe
I refer to your post on Jul 13:
"Total costs of redevelopment is S$130m. With the Kramat Road flagship last revalued @ S$185m in 2009, I somehow worked out the impending write-off (non cash) demolition of existing building at S$75m, leaving remaining land worth S$110m.
So with total value of S$240m for 752 rooms in prime Orchard Road - around S$320k per key, there should be more revaluation surplus on Hotel Grand just on this redevelopment alone."

The current book value should be lower after depreciation, but may not differ much from the $185m determined in 2009 . Should the total value be in the region of $315m (=$130m redevelopment cost + $$185m book value) instead of $240m? What are the components making up the sum of $240m?
Each room will cost $420k if $315m is the total value.
Thanks.

[greengiraffe]

H Grand already indicated that they are writing off the value to be demolished against the books. Hence if my estimates of the remaining land value at $110m is right, then the eventual "costs" of the new hotels will be S$240m.

We will wait for the coming results to determine if my estimates are correct. I understand from a friend that H Grand is retaining existing structure for the reconstruction, hence the demolition write-offs may not be as much and as a result the total "costs" will be higher.

Greengiraffe
I refer to your post on Jul 13:
"Total costs of redevelopment is S$130m. With the Kramat Road flagship last revalued @ S$185m in 2009, I somehow worked out the impending write-off (non cash) demolition of existing building at S$75m, leaving remaining land worth S$110m.
So with total value of S$240m for 752 rooms in prime Orchard Road - around S$320k per key, there should be more revaluation surplus on Hotel Grand just on this redevelopment alone."

The current book value should be lower after depreciation, but may not differ much from the $185m determined in 2009 . Should the total value be in the region of $315m (=$130m redevelopment cost + $$185m book value) instead of $240m? What are the components making up the sum of $240m?
Each room will cost $420k if $315m is the total value.
Thanks.

[portuser]

I thought the costs of the new hotels should include the cost of the ageing building that is to be demolished. Writing off the cost of the building does not lower the cost of the project.
I was given to understand during the AGM in 2011 that the existing building will be demolished. The company's announcement on 13 July also seems to suggest this as the redevelopment entails demolition of the existing building and piling:
"..... the Company has awarded the main contract for the demolition of the existing ageing hotel located at 22 Cavenagh Road, Singapore 229617, piling work and construction of two new 10-storey hotels of 264 rooms and 488 rooms each ............."