Cdl Submits Top Bid 1132 Psf Ppr Lakeside Drive Gls Site
Midtown Modern prices to be revealed on March 20Tender for Tengah Garden Walk GLS site closes with 15 bids
The tender for a Government Land Sale (GLS) site at Lakeside Drive drew six bids before it closed on June 3. The top bid of $608 million was submitted by City Developments Limited (CDL), exceeding the second-highest bid by 10.4%. The runner-up was a joint venture between Frasers Property and Mitsubishi Estate Asia, which offered $550.56 million. Other bidders included a CapitaLand Development-Sing Holdings joint venture, Wee Hur Holdings, a joint venture between Hong Leong Holdings and TID, and Sim Lian Group.
According to CDL’s group CEO, Sherman Kwek, the company plans to develop a 575-unit project with unblocked views of Jurong Lake Gardens. The Lakeside Drive site is close to the Jurong Lake District and has easy access to amenities, schools, and green spaces. The number of bids received for the site is an indication of developers’ willingness to invest in parcels with attractive attributes.
Notably, the Lakeside Drive site sits on a 145,314 sq ft plot and has a gross plot ratio of 3.6. This means it can yield 575 residential units and 10,764 sq ft of commercial space. It is also zoned for residential with commercial use at the first storey. The bids for the Lakeside Drive site show a rebound in response to GLS plots after the US announced reciprocal tariffs on April 2. The gap between the lowest and highest bids, at 24.5%, can also be attributed to mixed market sentiments among participants. Nonetheless, the site’s proximity to schools, MRT, and other amenities boosted its appeal.
Industry experts believe that the new development on Lakeside Drive will set a new benchmark price for the Lakeside area, surpassing the prices achieved by The LakeGarden Residences and Sora. These projects managed to attain median prices of $2,134 psf and $2,216 psf, respectively, upon launch. Property analysts suggest the new project will have an average selling price of $2,400 psf, making it the third-highest for a residential GLS plot in the Outside Central Region (OCR) in recent years.
The tender for the Tengah Garden Walk GLS site, which closed with 15 bids, shows just how tight the supply of residential land is for developers. According to Desmond Sim, head of research for Southeast Asia at CBRE, the number of bids put forth by developers, despite the downside risks, reflects high liquidity in the property market. Responding to a Business Times article published earlier in the week, Mr. Sim noted that the demand for land remained strong, with positive sentiments enhancing a “buying-in-bulk” fever among developers.
The Urban Redevelopment Authority (URA) confirmed that 15 bids were placed for the Tengah Garden Walk GLS site out of the six shortlisted developers. This translates to a 2.19 % increase from the 14 bids submitted for the Yishun Avenue 9 GLS site in September 2020, which slightly broke the record set for the Canberra Drive GLS site with 18 bids. The Tengah Garden Walk GLS site also registered a slightly higher number of bids compared to the Tampines Street 62 GLS site in November 2018, which had 11 bidders.
The highest bid came from a tender submitted by a 50-50 joint venture between Sing Holdings and MCC Land, of $400.33 million. This amounts to $603.20 per square foot per plot ratio (psf ppr). According to CBRE, the top bid mirrors a breakeven price of approximately $1,050 psf. This is lower than the average selling price of $1,169 psf registered at Parc Central Residences, which is situated along Tampines Avenue 10.
In a note published yesterday, CBRE analysts acknowledged that the Tengah Garden Walk GLS site’s close proximity to Tengah’s Central Park, Waterway Corridor, and the upcoming Tengah MRT Station all contributed to the tender’s attractiveness. The site is zoned for residential under the 2019 Master Plan, with a gross plot ratio of 2.1 and a site area of 295,701 square feet. Tampines Street 62 and Canberra Drive GLS sites have a gross plot ratio of 2.5, and multiple analysts had projected a low number of bids because of small site area.
In a similar vein, Tricia Song, CBRE’s head of research for Singapore and Southeast Asia, noted that the site’s breakeven price is competitive and comes with a 99-year lease. She also pointed out that the Tengah Garden Walk GLS site is a relatively small scale project that presents an opportunity for developers to capitalise on smaller units. She added that the popularity of smaller units has increased in the wake of the Covid-19 pandemic.
The Tengah Garden Walk GLS site’s former tender was launched on August 27 last year under the confirmed list of the H1 2020 GLS program. The tender was then closed on November 26 without gaining any bids. After a two-month reprieve, the URA relaunched the tender for the same site on January 28, providing developers with another chance to participate in the tender.
Industry experts opine that the high number of bids for the Tengah Garden Walk GLS site can be attributed to the younger demographic in the Tengah BTO estate. As noted by Cove Property Group’s executive director, Dr. Lee Nai Jia, the majority of saleable units in the site will likely interest first-time homebuyers and second-timers with housing grants. The development expected to be built on the Tengah Garden Walk GLS site could be a four- to five-storey project, and it is expected to accommodate approximately 695 units.
The $400.33 million bid submitted by Sing Holdings and MCC Land also shows the developers’ willingness to bid aggressively to secure land. It is worth noting that the top four bids were within a 5% range. Although the number of bids underscores a competitive market, the fact that the bids were within purchasing power suggests that developers remain disciplined in their bids.
The three-room, four-room, and five-room BTO flats launched in the non-mature estates registered a subscription rate of at least three times the flats available as of the project’s application deadline on Tuesday (February 23). This comes as housing open gets ready for a boost in supply to cater to the changing needs of the population.
The upcoming market is designed to ease the demand for bigger HDB flats from families who need room for their elderly parents or grown-up children, in addition to buyers looking for an upgrade. The three new Build-to-Order (BTO) flats was launched on February 17 and closed on Tuesday. They have a total of 7,862 units in the three non-mature estates of Tengah, Woodlands, and Bukit Batok.
4 Space Property broker, KEO Sean
The three-room mature estates in Queenstown and Bishan have attracted the highest number of applications relative to the home supply, with 1.1 applicants per home.
The BTO flats in the Tengah estate have recorded the highest subscription rate for its three-room flats, wit 2.6 applications per home. This was followed closely by the surplus four-room flats, which had 2.5 applicants for one home.
In a statement, HDB said the local demand for these BTO flats was expectedly strong, with 3,605 applicants expressing interest in the three non-mature estates. HDB has projected that there will be approximately 11,000 Build-to-Order flats in the current year (2021). 7,300 units have been made available in the first quarter.
In-state buyers are given priority when allocating HDB three-room, four-room, and five-room flat during the flat selection process. Younger Singaporeans (couples) including the first-timer families are also granted a higher priority when allocating the flats.
The 4space broker, Sean, also added that, “BTO flats that have a high application rate in non-mature estates are due to the balance in accessible facilities, unlike when it comes to flats in mature estates. These flats still maintain a healthy level of applications by people, and soon the development will be turned into the most sought-after project in the future”.
A total of 17,782 of the 23,300 flats in the balance numbers of flat (SBF) exercises have been made available for this year; the first batch of about 3,000 flats will be made available in March.
The coming SBF exercise, which includes 5 flats from 3 room, 107 three-room, 1,143 four-room, 382 four-room, and 325 five-room flats from Tengah, Bukit Panjang, Woodlands, and Kallang/Whampoa, closed yesterday.
Mr Sean also noted that the mature estate of Ang Mo Kio tops the chart for its 3-room SBF flats with an undervalued application rate of about 1.5 applicants per block.
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“Despite the ratio being high, it’s still not an absurdly high number as compared to others mature estates. It goes to show that there’s a healthy demand for flats in this estate,” he added.
The Rates In The Applications From Mr. Sean
The other mature estates have seen low SBF application rates for their flats according to the HDB