Bullish bid for land may mean higher home prices

A bid $65 million above the expected offer for a land plot is not something to scoff at. It also points to the site as having tremendous potential, are at the very least possesses characteristics which the winning developer is confident will eventually bring in profits.

The Creek in Bukit Timah.

The Creek in Bukit Timah.

Malaysian developer, S P Setia has offered $265 million for a 18,721.4 square metre site on Toh Tuck Road. The location, while tucked away behind Toh Yi Drive, is near enough to the Beauty World MRT station on the Downtown Line, as well as the series of shopping malls and eateries in the vicinity. Property analysts consider the bid bullish though understandable as the prices reflect the potential of the site’s location and size. It is also near the Bukit Timah housing district and schools such as Pei Hwa Presbyterian Primary and Ngee Ann Polytechnic.

The robust bid sets the benchmark for sites in the vicinity. Recent tweaks in the property cooling measures might have had developers in a slight tizzy over the procurement of land plots for future projects. While demand is strong, supply from the Government Land Sales (GLS) programme is slower this year.

For the consumer, the fierce bidding on recent land sites could be indicative of the direction home prices might be taking. The number of successful new launches this year could however account for the spending. The 99-year leasehold plot on Toh Tuck Road is expected to yield approximately 325 new private homes and is the first of 5 residential sites under the GLS confirmed list.

Potential for new mixed-use development in Bidadari

Akin to Punggol’s development as a Eco-town, Bidadari, which is lauded as the next “Bishan”, could be shaping up to be a garden township especially as the first private home and retail site comes up for sale in the essentially HDB public housing township.

Bidadari HDB estatePhoto credit: HDB

A 2.54 hectare site next to Woodleigh MRT Station will potentially yield 825 homes and shops and is aimed to be the landmark of the new housing estate. Developers who successfully tender the bid for the land plot will be required to build not only the homes and retail spaces but also a community centre, neighbourhood police branch and carpark, much similar to the requirements of a commercial site listed the Government Land Sales (GLS) programme.

Paya Lebar Quarter_Lendlease PLQPhoto credit: Lendlease

Though the public and community-based requirements may cut into the developers’ margins, property analysts say that these could also be a value-add in terms of being a catchment area to for commercial tenancy and to goose productivity. The private real estate nature of the project is relatable to Lendlease’s Paya Lebar Quarter (PLQ), Central Boulevard‘s white site which was acquired by IOI properties for $2.57 million last year and older sites such as Raffles Hotel and the site which now holds Chijmes. The developer’s proposal will be reviewed by a panel chaired by the Housing Board (HDB). The tender closes on June 13 and industry players are expecting some bids as developmental sites are hard to come by in today’s market.

2.11-hectare residential site in Queenstown up for sale

With a $685 million bid, sales of a new residential land site in Queenstown has been triggered. The reduction in land sales under the Government Land Sales programme has seen older properties more keen to go on the en bloc sales route, and developers have shown their eagerness in procuring land sites as market sentiment continues to improve.

queenspeak2This latest land site is a 2.11 hectare plot on Stirling Road with the propensity to yield 1,110 new private home units. This site was placed under the Urban Redevelopment Authority’s reserve list in 2010 which means it will only go on sale should the Government receive a bid of an acceptable level. The size of the plot can be credited to the combination of 2 adjacent sites which were merged into 1 in 2012. The 99-year leasehold site is near Anchorpoint Shopping Centre, Ikea, Queensway shopping centre and just a few stops way from the Bukit Merah bus interchange and Redhill and Queenstown MRT stations.

As the site is within walkable distance from Queenstown MRT station, property analysts anticipate competitive bidding this time round. The maximum floor area of the site comes up to 954,328 sq ft or approximately $718 psf though joint ventures for a land plot this size seems likely and bids are expected to vary from $838 to $950 psf.

Commonwealth TowersThe site is expected to receive from between 7 to 11 bids. Nearby properties which could set the precedent for pricing are the Commonwealth Towers and Queens Peak condominiums. Current prices at both developments stand at $1,654 and $1, 640 psf respectively. Projects in the vicinity have been selling well, especially with the recent lifting of the property curbs and a general lift in consumer sentiment.

Another HUDC estate tries for collective sale – Rio Casa

HUDCs certainly seem to making the news this year as yet another HUDC estate tries for an en bloc sale. Earlier last month, Braddell View became the last HUDC to be privatised and Shunfuville successfully completed their en bloc journey in May last year.

RioCasaHUDC HougangThis time, Rio Casa, formerly called Hougang N3 is trying their hand at the collective sale game. The process was surprisingly easy as 80 per cent approval was achieved within 3 weeks. Bidding is expected to hover around $450.3 million for the 286-unit site. If successful, each unit owner will receive $1.5 million which is approximately $586 psf. The property has about 73-years left to its lease and the new owner will have to fork out $57.5 million for a new 99-year lease. In addition, $141.5 million will be required for site-intensification.

Kingsford WaterbayThe site should be quite desirable as it features 200m of riverfront and greenery views with schools such as Holy Innocents’ Primary and High Schools and CHIJ Our Lady of the Nativity nearby. With the recent uptick in buying sentiments and the competitiveness in the Government Land Sales segment, developers may pay for the site despite its slightly pricier tag. There are considerations however, as the site is not near any MRT station and the nearby Kingsford WaterBay has unsold units remaining. It is still however early days and the Hougang area has a deep potential for redevelopment which may very well happen in the decade ahead. The tender for the site closes on May 23.

Next major condo launch to watch – Park Place Residences

Following the successful launches of The Clement Canopy and Grandeur Park Residences, The Park Place Residences at the Paya Lebar Quarter (PLQ) previewed on 11 March and developer, Lendlease is more than hopeful about the response.

Paya Lebar Quarter_Lendlease

Photo credit: Lendlease

With a prime location in the developing Paya Lebar regional hub, the 429-unit property will provide fodder for the current pent-up demand in the market. The 99-year leasehold development released 40 per cent or 171 apartment units at its first release a couple of weekends ago. Most of they units made available for selection were 2- and 3-bedders. The Park Place Residences is part of the $3.2 billion Paya Lebar Quarter (PLQ) development which will consist of 3 office towers, 3 residential blocks and a mall. It is jointly developed by Lendlease and Abu Dhabi Investment Authority.

The developers are already planning for a second wave of release, where the pricing will be higher and based on the response from the first wave. As interest in smaller, affordably-priced units have been on the rise, buyers will be interested to know that Park Place Residences will have 117 one-bedroom units sized between 480 and 580 sq ft with prices starting at $780,000. The project features mainly two-bedroom units sized between 650 and 900 sq ft starting at $1 million – there are 234 of these units in the project. The remaining 78 units are 3-bedders of between 1,080 and 1,350 sq ft priced at around $1.6 million.

ParkPlaceResidencesThe average selling price is between $1,560 to $1,610 psf. While this is higher than the $1,400 psf median prices of units at The Clement Canopy and Grandeur Park Residences, the location and potential for growth of The Park Place Residences more than make up for it. It will be launched for sale on March 25.

More private land sites up for collective sale

With improving sentiments in the real estate industry, land and property owners are beginning to test the waters once more with new freehold sites and shophouses up for collective sale.

Goh&GohBuildingAn exciting prospect comes in the form of the Goh & Goh Building in Upper Bukit Timah. The 4-storey building is a mixed-use site currently consisting of 7 residential units and 7 shophouses. It has recently been put up for collective sale with a tag of $120 million. Situated right at the doorstep of the Beauty World MRT station and next to the Bukit Timah Shopping Centre and Beauty World centre, it is a delicious plot of prime land indeed. And a sale could be on the way as almost 80 per cent of the building’s owners have already given their consent for the go ahead of the collective deal.

Properties in the area have been selling swiftly and developers who are looking to replenish their land bank in the area will no doubt keep a keen eye on this land. The area has further potential for development, in terms of infrastructure and amenities. It is also situated in between the Upper Bukit Timah, Bukit Timah, Bukit Batok and Jurong Kechil areas where both local and international schools dominate. In fact, neighbouring land plots have already been earmarked for hotels, hospitals and other residential or mixed-use properties.

Hillbrooks CondoAfter taking into account the $15 million development charge the successful bidder is estimated to have to pay, property analysts expect the land rate to hover around $1,460 psf and the winning developer could possibly accommodate around 100 residential units in the new project.

Winning $292 million West Coast Vale land sales bid

Properties in West Coast have been garnering tons of interest lately. One of the latest offerings in the area is the Parc Riviera condominium, and nearby the Clement Canopy also recently launched last weekend.

parcriviera3Thus a winning bid of $292 million for a 99-year leasehold site in West Coast Vale probably did not come as a surprise. The bid was won by China Construction Development, with 8 other bidders vying for the same site. Second in line was MCC Land (Singapore) with a bid of $289.9 million. The affordable quantum was likely what drew the bidders as the plot was one of the last to be offered up for tender last year under the Government Land Sales Programme. The site was launched on December 7.

Considering the final bidding price of $592 psf is 7.4 per cent higher than the $551 psf paid for the neighbouring Parc Riviera project, the developers must be optimistic about the prospects of the property market. Parc Riviera is closer to the Ayer Rajah Expressway though the proximity of the Jurong Lake District and malls such as Jem will help in marketing the property to potential buyers.

parcriviera2Developers have been seen to be more aggressively bidding for land plots in recent tenders as most are hoping to replenish their land banks and preparing for better times ahead as the property market is seen to be bottoming out.

First private condominium launch in 2017 – Clement Canopy

Open for preview today is a new condominium in the west – on Clementi Avenue 1 to be exact. The 505-unit Clement Canopy is a joint venture between UOL Group and Singapore Land and the developers are hopeful about an uptick in demand, as shown by a pickup in new home sales last year.

The-Clement-Canopy-1Photo credit: http://clementcanopy.info

Situated in the Jurong Lake District – which is earmarked to be developed into the second Central Business District (CBD)– and with a number of schools such as the NUS High School of Mathematics and Science and the Yale-NUS College, this new condominium project will benefit from high rental demand. The 99-year leasehold development will consist of two 40-storey blocks holding a range of 2- to 4-room units. 194 out of the 505 units are 2-bedders sized between 635 to 732 sq ft and priced between $85,000 to $1 million. These smaller units are more palatable in terms of the total quantum price and also more in demand in the rental market.

The TrilinqOther bigger units include 3-bedders starting at $1.28 million and 4-bedders priced from $1.62 million. Selling prices are pegged between $1,340 to $1,360 psf. As a comparison, the neighbouring private residential condominiums, The Trilinq, is going for $1,400 psf but it is a tad nearer the Clementi MRT station; and Parc Riviera on West Coast Vale is selling at around $1,200 psf . There are no one-bedroom apartments at Clement Canopy and developers are hoping this will help differentiate their product from the rest of the market. Swimming pools and smart home features will be included in the project.

This year, the  would probably be all about timing. Launched at the right time, when demand is high and supply slow in stirring consumer interest, a new development could do very well indeed.