URA awards Zion Road site to CDL-Mitsui Fudosan JV, and Upper Thomson Road site to GuocoLand-Hong Leong JV

The $905 psf ppr bid put in by GuocoLand-Hong Leong is “reasonable” as it is a much bigger site compared to the Zion Road plot, claims Yip, adding: “Therefore the quantum is larger, and with a larger quantum the possibilities are correspondingly bigger too”.

URA has allocated the tender for two just recently shut government land sale (GLS) spots. A non commercial site at Zion Road was awarded to a mutual project (JV) between City Developments Ltd (CDL) and Mitsui Fudosan, whilst a several GLS location at Upper Thomson Roadway was awarded to a JV among GuocoLand and Hong Leong Holdings.

Mark Yip, Chief Executive Officer of Huttons Asia, claims that the eye-watering cost for the spot is a “substantial dedication in the face of high interest. Considering these dangers, the quote of $1,202 psf ppr is fair”.

Wong Siew Ying, head of research and information at PropNex Realty, mentions that although the land costs were beneath market assumptions URA likely considered other elements in evaluating the bids. “For instance, the Upper Thomson Road story being in a fairly untried new housing precinct, and the Zion Roadway story being the first property development to make up the long-stay serviced apartments,” she claims.

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This was reiterated by Tricia Song, head of research study, Singapore and Southeast Asia, CBRE. She notes that the quote for the Zion Road location is a “significant” 30% less than the comparable land parcel across the road, which has been turned into the 455-unit Riviere. “The approval of the lower-than-expected proposal price in spite of its being the single bid, is a recognition that market conditions have transformed over the last 5-6 years considering that the bordering spot was granted, given aspects such as enhanced ABSD, greater building and construction expenses, funding prices, as well as danger premium for the (long-stay serviced houses) component which is a brand-new property course,” explains Song.

According to a GuocoLand speaker: “The Upper Thomson Road site is situated in a premium landed housing spot, comparable to the Lentor Hills estate which we have actually developed as a brand-new superior exclusive residential estate via our projects such as Lentor Modern and Lentor Mansion. We are excited to have the possibility to uplift another brand-new neighbourhood at Springleaf via our placemaking capabilities. The future advancement, which is offered by the Springleaf MRT station on the Thomson-East Coast Line, are going to have available 940 units.”

On the other hand, the GuocoLand-Hong Leong JV sent a quote of $779.6 million for the 344,700 sq ft area around Upper Thomson Road. The cost converts to $905 psf ppr.

” At a land cost of S$ 1,202 psf ppr, the breakeven price could potentially range in between S$ 2,400 psf and S$ 2,600 psf depending on technical, material and style considerations, with kick off rates starting from S$ 2,700 psf,” states Alice Tan, head of consultancy at Knight Frank Singapore. She adds that the brand-new project can go for about S$ 3,000 psf and this price would certainly not only be tasty, however attractive for Singaporean property buyers and irreversible locals, whether for job or investment.

Tan forecasts that the brand-new development may see a possible launch opening cost of only under S$ 2,000 psf. “As the Upper Thomson Roadway Parcel B area would certainly be the initial in a fairly pristine area without high-rise residences, there is some very first mover benefits in a picturesque precinct,” she says.

CDL and Mitsui Fudosan sent a $1.107 billion offer for the 164,439 sq ft location, which translates to $1,202 psf per plot ratio (ppr). The site has a plot ratio of 5.6 and is zoned residence with business on the first floor. The new property development can yield up to 1,170 brand-new residential units. This is likewise the first site released by the federal government that featured devices under the new long-term serviced residence program.

The JV affiliates have actually previously shown that they mean to establish the site into a mixed-use property consisting of 2 housing blocks, one that is 69 floors and the some other 64 storeys, with about 740 house units up for sale in overall. The organized development will also consist of a retail platform, and a 35-storey block with regarding 290 rental apartment units.

The CDL-Mitsui Fudosan JV was the only one to submit a quote for the Zion Road location the moment the tender closed up on April 4. Likewise, the GuocoLand-Hong Leong JV also submitted the sole proposal for the Upper Thomson Road GLS site when that tender closed on April 4. Eugene Lim, key executive officer, period Singapore, commented that both GLS spots are fairly ‘untried’. “The state might have taken into consideration the tender prices submitted for these locations to be affordable, taking into consideration the risks that these designers are prepared to take on,” he explains.


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