City Harvest Church may have been in the spotlight for its murky finances lately but one of the church's investments has done very well.
The church owns part of a fund that holds Suntec Singapore Convention and Exhibition Centre, a property whose value has nearly tripled after refurbishment works were completed late last year.
City Harvest has racked up a paper profit of about $162 million over five years, according to calculations by The Straits Times.
The overall value of Suntec has surged from $235 million as at the inception of the ARA Harmony Fund on Sept 30, 2009, to an average valuation of $663.25 million as at Sept 30 this year, fund manager ARA said last week.
That represents a jump of about 182 per cent over five years.
ARA said that the fund's internal rate of return, after deducting about $16.1 million in performance fees, worked out to 26.3 per cent over the first five years of the fund's existence.
The internal rate of return is a measure of how profitable an investment is. The higher the rate of return, the more profitable it is.
City Harvest does not directly hold shares in the ARA Harmony Fund.
Rather, it is part of a consortium of private investors called Harmony Partners Investments which owns 80 per cent of the fund.
It joined the consortium around March 2010, several months after the fund was started.
The remaining 20 per cent belongs to Suntec Reit, which ARA also manages.
A City Harvest spokesman told The Straits Times earlier this week that it has invested $97.75 million in a 49 per cent stake in the consortium.
Since the consortium holds 80 per cent of the fund, City Harvest's effective indirect stake in the fund works out to about 39.2 per cent.
This means that City Harvest's stake in Suntec is now worth about $260 million.
Founding pastor Kong Hee announced in March 2010 that the church would invest $310 million to own part of Suntec, where the church holds its services. This included the cost of buying shares in the consortium, rental and renovation fees and other costs, The Straits Times reported back then.
However, the City Harvest spokesman said in her statement earlier this week that the church had not paid $310 million for its stake in the consortium.
She said that the $310 million figure reported earlier "was the amount the church sought to raise in order to execute its procurement of a stake plus cover other necessary costs".
She added that the church has not sold any of its holdings in the consortium and does not plan to.
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