NATIONAL industrial infrastructure developer JTC Corporation yesterday said it will launch a public tender for a 1.24 ha industrial site in Ubi on the reserve list.

This comes after it accepted an application from a developer to put the site on sale. JTC said that the developer has committed to a bid price of at least $29.38 million. It will launch the tender for the plot of land – made available for sale on Oct 30 last year through the reserve list system – in about four weeks.

The site is located between Ubi Road 1 and Ubi Ave 4, and is zoned for ‘Business 1′ use, which means it can house clean and light industry firms – which includes computer software development and printing and publishing companies.

The land has a maximum gross floor ratio of 2.5 and a lease period of 60 years. The successful developer must complete the project in 96 months.

Source: Business Times, 31 Dec 2010

Offer of $123m just 0.7% above next highest; 99-year plot drew 11 bids

TUAN Sing yesterday made a rare appearance at a state tender, and that too as the top bidder. Its offer of $123 million for a 99-year leasehold low-rise private residential site at Seletar Road works out to about $468 per square foot per plot ratio (psf ppr).

While that was below a seasoned property consultant’s prediction that the top bid would be in the $550-600 psf ppr range, the 11 bids that the plot drew yesterday surpassed his earlier prediction of 4-8 bids. The turnout was one of the best showings at state tenders this year.

Tuan Sing unit Asplenium Land’s top bid was just 0.7 per cent above the next highest offer of $122.1 million or $464 psf ppr by a unit of Fragrance Group.

‘Developers still have a strong appetite for choice residential sites like this, in the established Seletar Hills residential estate and next to the future retail facility at Greenwich V,’ said Credo Real Estate executive director Ong Teck Hui. ‘However, at the same time, developers are cautious with their bids, bearing in mind the cooling measures put in place on Aug 30, the substantial state land sales programme for H1 2011 and a lingering fear of whether there’ll be further property cooling measures.’

Also bidding yesterday was Malaysia’s SP Setia International, which offered about $440 psf ppr. Far East Organization – which in September last year clinched an adjacent plot which it is now developing into Greenwich V shops and The Greenwich condo – teamed up with Japan’s Sekisui House to emerge as the fourth highest bidder yesterday at about $433 psf ppr.

The lowest bid of about $335 psf ppr was from Meadows Investment (controlled by Tiong Aik Group executive director Neo Tiam Boon). The tender also drew bids from Hong Leong Group/City Developments, Centurion RE and EL Development, among others.

The 1.7-hectare site can be developed into a five-storey condo or two-storey landed/strata landed homes. Property consultants’ estimates of Tuan Sing’s breakeven cost for a new condo are $800-900 psf.

Mr Ong noted that at The Greenwich next door, smallish units have fetched $1,300 psf upwards and normal-sized units $1,100 psf upwards in recent months. Given these price levels, he described yesterday’s tender bids as ‘not bullish’. He attributes this to the latest site being ‘landlocked’, sandwiched by the Greenwich development, a SingTel telephone exchange and landed estates.

CB Richard Ellis executive director Li Hiaw Ho reckons that a new condo on the plot is likely to attract middle-income households in the location as well as investors targeting the labour force in Seletar Aerospace Park.

Far East had paid $376 psf ppr for its plot. Up to 15.3 per cent of the maximum gross floor area of Far East’s site was set aside for commercial development. That tender attracted a dozen bids.

SLP International Property Consultants executive director Nicholas Mak said that the 11 bids at yesterday’s tender was the highest for a private housing site offered at a state tender since June this year, when a plot at Upper Serangoon Road/Pheng Geck Avenue drew 15 bids.

Property market watchers were surprised by Tuan Sing’s participation at yesterday’s tender. The group, controlled by the Nursalim (also known as Liem) family from Indonesia, has been keeping a low profile in the Singapore property market of late. Earlier this year, it completed the sale of Katong Mall to a consortium of investors for $247.6 million.

A Tuan Sing unit is developing Mont Timah, a 99-year leasehold project comprising 32 strata cluster homes in Upper Bukit Timah, boasting views of Bukit Timah Nature Reserve.

Source: Business Times, 15 Dec 2010

Close fight for 1.7ha residential plot sees six bids at over $400 psf ppr

PROPERTY group Tuan Sing Holdings has come out on top – but only just – in a bidding war between 11 developers for a residential site in Seletar Road.

The firm offered $123 million for the 1.7ha plot – or $468 per sq ft (psf) per plot ratio (ppr), which was a touch ahead of Fragrance Group’s $464 psf ppr.

It was such a close fight for the site, which is part of the government land sales (GLS) programme, that six of the 11 bids came in over $400 psf ppr.

Other bidders – a mix of major and mid-sized developers – included Far East Organization, City Developments, EL Development and Malaysian firm SP Setia International.

Mainboard-listed Tuan Sing’s bid was 40 per cent higher than the lowest bid of $88 million – or $335 psf ppr – from Meadows Investment, a firm owned by Mr Neo Tiam Boon, executive director of local property and construction firm Tiong Aik Group.

Mr Ong Kah Seng, senior manager of Asia-Pacific research at Cushman & Wakefield, said the Tuan Sing offer was an ‘optimistic’ one.

The many big bids were due to ‘developers encouraged by the recent improvement in overall home-buying interest’, he added.

The fact that 11 developers were competing for the site also reflected significant interest from developers to replenish their land banks despite many GLS sites becoming available in the first half of next year, Mr Ong said.

It was also the highest number of bidders in a GLS tender since the site at the junction of Upper Serangoon Road and Pheng Geck Avenue went on the market in June.

The 99-year leasehold Seletar site is next to Far East’s The Greenwich project and in the Seletar Hills residential estate.

It has a maximum permissible gross floor area of about 263,000 sq ft and could yield about 270 units.

The upcoming project will be only the second new condo project in the Seletar Hills estate and so is likely to attract middle-income households and investors, say property experts.

Mr Nicholas Mak, head of consultancy and research at property firm SLP International, said that as the site can also be developed into landed housing, developers might have been drawn to the tender as strong demand for such housing is expected to continue next year.

Mr Li Hiaw Ho, executive director of CB Richard Ellis Research, expects a break-even cost of about $800 psf for the development.

He said investors might target staff at Seletar Aerospace Park, which will be fully completed in 2018. Shopping and communal facilities can be found in Ang Mo Kio and Sengkang new towns which are a short drive away, he added.

‘With the whole Seletar area currently being revitalised, and with The Greenwich achieving around $1,200 psf for the loft units and standard apartments being sold at $950 psf on average, the top bidder will be looking at launching at around the same price band,’ he added.

About 250 units of 319-unit The Greenwich – or 78 per cent – have been sold since August.

SLP’s Mr Mak estimates that the new Seletar units could go for between $1,080 and $1,180 psf.

Source: Straits Times, 15 Dec 2010

A NEW 16-storey condominium is set to come up near Punggol MRT station after a tender for a land site there closed yesterday with seven competitive bids.

Sim Lian Land and Sim Lian Development submitted the top offer for the land parcel at the corner of Punggol Central and Punggol Walk, according to the Urban Redevelopment Authority.

Their bid of $363 million for the 2.7ha site just topped the second-highest offer of $361.7 million. That bid was submitted by China-based Qingdao Construction (Singapore).

Next was Hong Leong Group’s Intrepid Investments with a bid of $321 million, while Keppel Land Realty tabled an offer of $318.8 million.

The partnership between FCL Topaz, Far East Civil Engineering and Sekisui House put in a $297 million bid, and Ho Lee Group’s Khai Wah Development sent in a $266.7 million bid. Allgreen Properties rounded up the list with a bid of $257.9 million.

Sim Lian’s offer works out to $406.30 per sq ft (psf) per plot ratio. The developer said yesterday that it plans to build a 16-storey project comprising 800 units.

The development will offer a mix of units ranging from two- to four-bedroom apartments and penthouse units, Sim Lian said. It is expecting to launch the project by the fourth quarter of next year.

The plot of land has a maximum permissible gross floor area of 888,905 sq ft, and an additional 4,489 sq ft to include the existing conservation building, Matilda House, located within the site.

Matilda House, which is to be conserved and restored as part of the development, is the only remaining historic bungalow in Punggol Town. The building can be restored for use as a clubhouse or for private residential use within the development.

CB Richard Ellis Research executive director Li Hiaw Ho said the historic building, a piece of history from old Punggol, would enhance the lifestyle of the project’s future residents.

Mr Li pointed out that the bids in the tender yesterday showed the keen interest that developers had in the site, which could be because of its proximity to an MRT station.

He observed that units at Oasis@Elias , a private condominium in Pasir Ris, were sold at $650 psf to $780 psf in the September to November period.

But nearby NV Residences fetched higher prices for the same period – between $830 psf and $910 psf – because of its proximity to Pasir Ris MRT station and White Sands shopping mall, said Mr Li.

He added that the top bid of $363 million for the Punggol site translates to a break-even cost of about $750 psf, and that the project may be able to fetch around $800 psf when it is ready for launch.

Source: Straits Times, 8 Dec 2010

CITY Developments (CDL) unit Grand Isle Holdings has emerged as the top bidder for an executive condominium (EC) site in Segar Road.

Yesterday’s tender results saw CDL’s top bid of almost $182 million, or $271 per square foot per plot ratio (psf ppr), coming in 15.5 per cent ahead of the second-highest offer of $157.5 million, or $234 psf ppr, submitted by EL Development.

Three other bids were submitted – Opal Star and Lum Chang Building Contractors sent in a joint offer of $128.3 million, Pinnacle Realty bid $120 million, and Sim Lian Land came in with the lowest tender at $113 million.

A CDL spokesman said the developer has plans to build a 15- to 17-storey EC on the 1,936 sq ft site and, if awarded, it would be CDL’s fourth EC project.

Previous ECs developed by CDL were The Esparis in Pasir Ris, The Florida in Hougang, and Nuovo in Ang Mo Kio.

Located in Bukit Panjang, the 99-year leasehold Segar Road site has a plot ratio of 3 and a maximum gross floor area of 5,806.6 sq ft. It can potentially yield an estimated 570 units.

Mr Joseph Tan, CBRE’s residential executive director, said CDL’s bid translates to a breakeven cost of $570 psf to $590 psf.

He added that there will be a market for the new EC project if it is priced

20 per cent to 25 per cent lower than nearby private condo Tree House, which sold at an average price of $830 psf in the second quarter of this year.

ECs are a hybrid of public and private housing with ownership and resale restrictions applying in the first 10 years, after which they are fully privatised.

Boasting private condo facilities, they are an attractive housing option for buyers who meet the eligibility criteria, including a monthly household income ceiling of $10,000.

Under the current Residential Property Act, foreign developers are subject to the stipulated project completion period of five years.

This rule, however, does not apply to local developers.

Source: Straits Times, 3 Dec 2010

A COMPANY linked to construction firm Low Keng Huat yesterday put in the top bid for a public housing site under the Design, Build and Sell Scheme (DBSS) for condo-style public flats.

But there was not much competition: only one other bid came in for the plot at Upper Serangoon Road opposite Serangoon Secondary School, the Housing Board said yesterday. This is the weakest reception for a DBSS tender since 2008.

Kwan Hwee Investment beat the other contender, Sim Lian Land, with a bid of $155.23 million. The company came in second in a tender last month for a DBSS site at Bedok Reservoir Crescent.

The Upper Serangoon plot measures 215,278 sq ft and has a maximum gross floor area of 753,474 sq ft. This works out to be about $206 per square foot per plot ratio (psf ppf).

The site is estimated to yield 630 dwelling units.

Mr Nicholas Mak, research executive director for SLP International Property Consultants, said the recent slew of sites announced for sale by the Government could be one of the reasons for the low number of bids for this plot.

The Government Land Sales programme for the first half of next year will have a total of 30 sites that can generate a record 14,300 residential units – higher than the 13,900 residential units offered for the second half of this year.

For that reason, said Mr Mak, some developers may be conserving their residential resources for upcoming land tenders.

‘Another reason is that some developers may also be concerned that the HDB resale market may cool, thereby reducing the demand for DBSS flats,’ he said.

He estimates that Kwan Hwee Investment’s bid could translate to a break-even cost of about $420 to 450 psf. He added that this would mean a five-room flat in the project could be launched at a price of $500,000 to $535,000.

Meanwhile, Punggol will soon see the launch of its first executive condominium, located in Punggol Central.

Prices at Prive will average between $660 and $690 psf, said NTUC Choice Homes Co-operative in a press release yesterday. It is jointly developing the project with CEL Development.

The four-tower development will comprise 680 apartments, ranging from two- to four-bedroom units.

Apartment sizes start from 775 sq ft for a two-bedder to 1,442 sq ft for a four-bedroom unit.

Viewing and e-application start from Friday, while sales bookings start from Dec 10.

Source: Straits Times, 1 Dec 2010

Many residential plots in Govt’s latest land release programme are near MRT

THERE are plenty of plum sites among the new plots in the Government’s latest land release programme to tickle the fancy of developers.

The 17 plots with a residential aspect on the confirmed list include 11 that are near MRT stations, always an inducement for builders and home buyers.

The decision to spice up the sites on offer this time might be due to the lack of response to an executive condominium (EC) site in Jurong West.

The land did not receive a bid when its tender closed in August, likely due to its remote location and increasingly selective developers, who have their pick amid a bumper land supply.

Most sites in the release announced on Thursday are also near previously launched plots in Punggol and Buangkok that received strong demand from developers, said DMG & Partners analyst Brandon Lee.

Mr Lee added that the site locations may be aimed at meeting market demand and also strategically based on ‘regions that the Government is trying to spruce up’.

Mr Marc Boey, the Urban Redevelopment Authority’s (URA) group director of land sales and administration, said on Thursday that ‘the larger consideration behind putting so many sites in the North-east is to develop Punggol and Sengkang towns since these are new towns’.

‘If you look at Hougang, we also have some sites to cater to HDB upgraders,’ he added.

Confirmed list sites go on sale regardless of interest and are often an indication of the Government’s strategic development plans. Land on the reserve list is put up for tender only if developers make an acceptable initial offer.

Of the 17 newly introduced sites with a residential component on either the reserve or confirmed lists, two are in Hillview Avenue in the Bukit Batok planning area.

That these were included probably signifies the Government’s intent to further build up the area in tandem with the completion of infrastructure works such as Hillview MRT Station. Part of Downtown Line 2, it is slated for completion in 2015, experts said.

Mr Ong Kah Seng, Cushman & Wakefield’s senior manager of Asia-Pacific research, said Hillview was once a semi-industrial area but was converted largely to residential use in the 1980s. This prompted the building of various condo projects.

One of the Hillview Avenue sites is a commercial and residential plot on the confirmed list which is estimated to be launched in February next year.

It was scheduled to be made available for sale on the reserve list in October 2008 but was eventually withdrawn amid a poor market.

The other site is for residential use and is on the reserve list.

DMG’s Mr Lee said that the last government land site sold in the area was a Bukit Batok East plot in 2000. Far East Organization has since developed it into the 572-unit Hillview Regency.

The Government has also released smaller commercial sites such as the 0.29ha plot at the corner of Robinson Road and Cecil Street and a 1.42ha site in Paya Lebar. These could yield about 92,120 sq m of commercial space.

The URA said smaller sites which can be completed in about three years will help allay fears of a shortage of office space in 2014 once most ongoing developments have been completed.

Dr Chua Yang Liang, research head at Jones Lang LaSalle, said the release of the Robinson Road site was not surprising given the Government’s intent to rejuvenate the Tanjong Pagar area into an integrated zone for ‘live, work and play’.

Two hotel sites in Kallang Riverside are on the reserve list. A second parcel has been introduced for the first half of next year even though the first site did not draw any acceptable bids from developers when on the reserve list under the previous land sales programme.

Cushman’s Mr Ong said that the inclusion of the two hotel sites could be due to the level of optimism in the industry thanks to increased visitor arrivals.

Mr Li Hiaw Ho, executive director of CB Richard Ellis Research, added that Kallang has been earmarked to be gradually transformed into a waterfront precinct with housing and the upcoming Sports Hub.

‘A river-view hotel catering to athletes and other sports fans will help to further enhance the development of the Kallang area,’ he added.

The last hotel site in the Kallang area was awarded in October 2008 to Citywide Land for $51 million, or $250 per sq ft per plot ratio.

Source: Straits Times, 27 Nov 2010

THE Urban Redevelopment Authority has made a commercial/residential plot in the Bukit Panjang area available for application.

The Reserve List site is next to an existing LRT station and the future Bukit Panjang MRT Station under Downtown Line 2, which will be connected to key precincts in the city centre such as Bugis and Marina Bay.

At least 35 per cent of the 612,078 sq ft maximum gross floor area (GFA) must be set aside for commercial use.

The project’s residential component could yield about 310 apartments. The 1.9 hectare site – at the corner of Petir and Jelebu roads – is occupied by a bus interchange, which will have to be redeveloped and integrated within the future development. The GFA for the permanent bus interchange will be counted as part of the total GFA for commercial use, URA said.

Despite the fact that the state will continue to roll out a substantial quantum of residential land through the Confirmed List in the first half of 2011, some developers could still be keen on applying for the Bukit Panjang mixed-use plot to be released for launch from the state’s Reserve List if they are keen on embarking on a suburban shopping centre development.

And the sale of the residential component would help finance the development, analysts say. ‘Those keen on the site would have to be confident of making the shopping centre successful,’ says Credo Real Estate executive director Ong Teck Hui. ‘The mall would have to be sufficiently large and have an attractive tenant mix to create critical mass and compete with the surrounding malls.’

The plot is a stone’s throw from Bukit Panjang Plaza and Ten Mile Junction.

Cushman & Wakefield senior manager (Asia Pacific research) Ong Kah Seng says that if the plot were launched today, it could draw about five bids, with top offers ranging from $330-370 per sq ft per plot ratio.

‘They would probably be looking at an average selling price of about $770-830 psf for the apartments assuming they are marketed in the second half of next year,’ he said.

Earlier this year, Far East Organization clinched the Ten Mile Junction site in a state tender for $164 million or $437 psf ppr. It plans to retrofit the existing retail space to create a new mall called Junction 10, with about 120,000 sq ft of retail space, and develop 338 small office-home office (SoHo) units. The construction cost for the entire project is estimated at $100 million.

The SoHo project – called The Tennery – will be launched in the first quarter of next year. The units are expected to be upmarket – along the lines of Far East’s The Greenwich in the Seletar Hills area.

Source: Business Times, 27 Nov 2010

As caution sets in, the difference between winning bids and the rest starts to narrow

(SINGAPORE) Developers looking to build homes are no longer bidding with wild abandon at Government Land Sale tenders as the impact of the property cooling measures kicks in.

This can be gauged from the fact that the gap between the top bidder and next highest bid for residential sites and sites with residential components has started to narrow.

The gap peaked in August and early September before declining in recent weeks as the impact of the Aug 30 measures gradually took effect, according to an analysis by Jones Lang LaSalle.

The gap (measured by the difference between the top two bids divided by the second highest bid) peaked at 31 per cent for the condo plot at Miltonia Close next to Orchid Country Club in the Yishun area offered at a tender which closed in August.

Another tender that closed on Sept 1, a residential-commercial plot next to Bedok MRT Station, also saw a relatively high winning margin of 21 per cent.

The trend persisted into early September, with a tender for a condo plot at Jalan Eunos/Foo Kim Lin Road drawing a 26 per cent winning margin from top bidder Far East Organization when it closed on Sept 7.

Since then, the margin has slipped to single-digit per cent levels, mostly between one and 4 per cent. Between Jan 1 and July 31 this year, the winning margin ranged from one to 17 per cent, with the 17 per cent premium paid by a Far East Organization-Frasers Centrepoint tie-up for a private condo plot at Yishun Ave 2/Canberra Drive offered at a tender which closed in June.

Market watchers suggest that the margin being at its widest in August and early September reflected the bullish sentiment prevailing in the property market at the time that led the government to rein in the market on Aug 30.

JLL’s South-east Asia research head Chua Yang Liang says: ‘The trend of thinner winning margins reflects a more cautious stance by developers as a result of the latest anti-speculative measures.’

When the market is bullish, a more optimistic developer may be willing to pay a higher premium than its competitors.

But when developers turn conservative, there tends to be a greater consensus of views, including on land price, he added.

Knight Frank chairman Tan Tiong Cheng said that the wide spread between the top two bids at land tenders back in August and early September reflected a divergence in views among developers.

‘Some were bullish while others were less so. Then came the Aug 30 measures and developers became more circumspect. Everybody seems to have become more careful, translating to less divergence in their market views and hence a much smaller winning margin at more recent tenders.’

Agreeing, DTZ executive director (consulting) Ong Choon Fah said: ‘Sentiment was generally bullish in August but there was also a lot of ‘noise’.

‘People read the market differently as some were concerned about the government coming up with more steps to cool the property market. Since the government announced the measures, there is less uncertainty and hence greater consensus of views.’

Knight Frank’s Mr Tan says that another reason that winning bidders at state tenders have been less aggressive of late is that the Aug 30 measures were thought to have a greater impact on the upgrader market and the sites on the government land sales programme are mostly in this market segment.

Mrs Ong reckons that the trend of a narrow winning margin could continue in the near future, but some sites will be hotly contested and their winning margins could again widen – for instance, smallish plots, as these will draw a bigger pool of contenders including boutique developers.

Close to 14,000 private homes (including executive condominiums) are estimated to be generated from sites sold and to be sold under the government land sale programme this year.

This figure includes 9,790 units that can be built on sites sold so far this year, and 3,470 units on seven sites that are pending – either the tenders have yet to close or have yet to be awarded.

In addition, a site in Punggol Walk/Central that can be developed into 685 homes will be launched later this month.

Source: Business Times, 9 Nov 2010

PROPERTY giant Far East Organization has emerged as the top bidder for a 99-year-leasehold private housing plot at Woodgrove Avenue in the Woodlands area. Its top bid of $105.12 million works out to about $333 per square foot (psf) of potential gross floor area – about 4.2 per cent higher than the next highest bid of about $100.90 million by EL Development.

The state tender drew six bids.

Far East is planning to develop a five-storey condo incorporating some townhouses on the site.

‘Tenders for average suburban housing sites seem to have settled into a predictable pattern in terms of bid and price response. The top bids for such plots at the past four state tenders have been consistently in the $330-350 per square foot per plot ratio (psf ppr) range,’ observes Credo Real Estate executive director Ong Teck Hui.

‘The highest bidders seem to be sharing similar sentiments of a rather flat market going forward,’ he added.

CBRE Research executive director Li Hiaw Ho estimates that Far East’s bid price would translate to a likely breakeven cost of about $650-700 psf. ‘The project will likely be launched above $800 psf,’ he added.

He noted that in the subsale market, units in the low-rise Rosewood Suites (under construction) were sold at $650-700 psf in the July-September period. In the secondary market, units in Woodgrove Condominium (also a low-rise project) changed hands at $560-675 psf while those in the Casablanca and Rosewood condo (these are mid-rise developments) were sold at $620-750 psf over the same period.

The site whose tender closed yesterday is a stone’s throw from the Singapore Sports School and about 1km from the Singapore American School. It is also nearly 700m from Woodlands MRT Station. Mr Li said the fact that the site managed to draw six bids shows that developers are fairly confident about this site as demand is likely to come from potential HDB upgraders as well as investors who want to tap the expatriate market.

The other four bidders yesterday were TID Residential ($95.4 million), BS Capital’s Bishopsgate Development ($86.28 million), Sim Lian ($86 million) and Ecco Development ($73 million or $231.16 psf ppr).

Far East executive director (development and planning) Chng Kiong Huat said: ‘We envisage a five-storey condominium development that will incorporate some townhouses, designed to complement the low-rise set-up. Buyers will have a choice of one to four-bedroom units and townhouses which will come with private terraces, roof gardens and dedicated car park lots.

‘This is an area that Far East Organization is familiar with, having developed a number of successful themed residential projects there such as Casablanca and La Casa executive condominium as well as a collection of New England-style houses within Woodgrove Estate popular with American expats with children attending the Singapore American School next to it.’

Source: Business Times, 5 Nov 2010