In a competitive bidding process, a joint venture consisting of GuocoLand, Intrepid Investments from Hong Leong Holdings, and CSC Land Group secured the highest bid at $435.2 million for a private housing site at Lentor Central in Yio Chu Kang. This 475-unit site translates to $982 per sq ft per plot ratio (psf ppr), representing a 0.3 percent decrease compared to a neighboring Lentor Gardens plot, acquired by GuocoLand and Hong Leong for nearly $985 psf ppr in April.
The provisional tender results, released by the Urban Redevelopment Authority, highlight developers’ cautious approach due to concerns about an oversupply of condominium projects in the Lentor area, coupled with increased market risks. High development costs, modifications to gross floor area definitions that reduce sellable space and potential profits, and recent property cooling measures also contributed to muted bids.
The dominance of GuocoLand and Hong Leong in the area may have deterred some developers. The potential average selling price for the Lentor Central site could still be around $2,100 psf, taking into account the top land rate of $982 psf ppr and the gross floor area modifications, according to industry experts.
In contrast, an entity linked to City Developments (CDL) submitted the highest bid of $294.9 million, or $904 psf ppr, for a 350-unit plot at Champions Way in Woodlands, an area with fewer new private residential developments. This bid surpassed the second-highest bid by 8.3 percent.
The strong bid for the Champions Way plot is attributed to several factors, including the impending completion of the Singapore-Johor Rapid Transit System (RTS), which will enhance connectivity between Singapore and Johor. Woodlands is also experiencing growth as the largest economic hub in the northern region, with pent-up demand due to the absence of new private condo launches since 2012.
While market sentiment for private condo sites has turned cautious, executive condominium sites, such as the one at Plantation Close in Tengah, have attracted more active bidding interest. This site achieved a record land rate of $703 psf ppr in a tender that drew nine bidders.
HDB recently awarded an executive condo site in Tengah to Hoi Hup Realty and Sunway Developments for $348.5 million, setting a new record high for executive condo land at $703 psf ppr. This confidence is fueled by strong sales momentum in recent executive condo launches within the Tengah area, making them more appealing to buyers considering the increased additional buyer’s stamp duty for second residential property purchases.
In summary, while developers exhibit caution in certain areas due to market dynamics, the demand for well-located, competitively priced properties remains strong, particularly in areas with growth potential and strategic transportation links.