Sengkang site with long river frontage draws nine bids - BT Jun 14 2013
THE tender for a plum 99-year private housing site along Fernvale Close in Sengkang West has drawn nine bids, with the top bid at 9 per cent above what the next-door plot had fetched in April.
The April tender drew eight bids.
Market watchers say that yesterday's provisional tender results reflect the superiority of the latest site, which boasts a long frontage along Sungei Punggol. Some also observed that developers continue to have a strong appetite for choice housing sites in the mass-market segment.
Ong Teck Hui, Jones Lang LaSalle national director, said: "This site is set back from major roads and has a longer frontage along the river whereas the earlier site is at the junction of two major roads and has a shorter river frontage."
At yesterday's tender, the top bid of $256.98 million or $533.01 per square foot per plot ratio (psf ppr) came from a three-way partnership of Frasers Centrepoint's FCL Topaz, Far East Orchard Limited and Sekisui House. It was just 2.8 per cent higher than the No 2 bid of $518.53 psf ppr from MCC Land (Singapore).
Mr Ong noted that yesterday's tender drew more competitive bidding than the April one. The top bid yesterday was 28 per cent above the lowest bid and the average bid was $481 psf ppr - while the next-door plot had a huge 136 per cent gap between top and bottom bids and an average bid of just $386 psf ppr. "All nine bids in the latest tender were above $400 psf ppr while only the top three of the eight bids in the earlier tender were above that level."
BT understands that the top bid yesterday would probably translate into a breakeven cost of about $950-1,000 psf and that the developers could be eyeing an average selling price of $1,100-1,200 psf, with a view to launch the project as soon as possible.
In a joint statement, Frasers Centrepoint, Far East Orchard and Sekisui said that they propose to build an 18-storey residential project comprising seven blocks with around 490 units.
To capitalise on the site's "tranquil location along Sungei Punggol and the surrounding lush greenery, close to 70 per cent of the units will enjoy expansive river and park views amid resort-style ambience". Nearby schools include Nan Chiau Primary School, Nan Chiau High School and Pei Hwa Secondary, the statement added.
The project will also be around 200 metres from Layar LRT Station, which in turn will be one stop away from the future Seletar Mall. In addition, the site will be connected to the integrated Sengkang LRT/MRT system and bus interchange, providing further shopping and dining options at the existing Compass Point Shopping Centre.
The consortium also highlighted that it has two other projects within the larger vicinity, Boathouse Residences in Upper Serangoon and Watertown in Punggol Central, which have been well received by the market.
Joseph Tan, CBRE executive director (residential), said: "The number of bids and quantum of bids submitted show that developers remain positive about the residential market. The tripartite consortium which placed the top bid has experienced relative success in its previous few joint-venture projects, especially from Watertown. This success has probably brought more confidence for them to bid aggressively in order to shore up their depleting landbank."
He estimates that the new project could be launched at an average selling price exceeding $1,200 psf, all things being equal.
At yesterday's tender, UOL Group was the third highest bidder, at around $498 psf ppr. It had clinched the next door site in April for $489 psf ppr.
The other bidders yesterday were Kingsford Development ($491 psf ppr), City Developments unit Bellevue Properties and Chip Eng Seng's CEL EC Development (both $475 psf ppr), World Class Land ($472 psf ppr), Leng Hoe Development ($454 psf ppr) and EL Development ($415 psf ppr).
Source from Business Times
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