URA Launches Tender For Kovan Condominium Plot

Source : The Business Times, 8 Aug 2007

The Urban Redevelopment Authority (URA) yesterday launched the tender for a 99-year-leasehold condo plot next to Kovan MRT Station and the Kovan Melody condo, which is expected to be much sought after by developers.

The nearly 190,000 sq ft site can be developed into a condo with about 555 units, according to official estimates in the second-half 2007 Government Land Sales (GLS) Programme statement issued in June.

CB Richard Ellis executive director Li Hiaw Ho reckons top bids for the latest plot could come in close to $400 per square foot of potential gross floor area, or a lump sum of $265 million. ‘We expect that units in the new condo on the site can be marketed at $750 to $800 psf, when it is launched in mid-2008,’ Mr Li said. Apartments at Kovan Melody were changing hands in the resale market at $600 to $700 psf in June-July 2007, he noted.

Farther away, next to Buangkok MRT Station, newly released units in The Quartz condo are being sold by developer GuocoLand at an average $680 psf. Market watchers expect strong interest from developers for the latest plot being offered by URA. ‘The presence of premier schools such as Rosyth, Maris Stella High and Paya Lebar Methodist Girls’ will be a pull factor (for a condo on the site) for families with young children. With the recent upturn seen in the suburban market, developers are likely to vie for this site,’ Mr Li said.

And given that Kovan Melody has sold out, there could be pent-up demand for new homes in this location, he reckons.

URA said the tender for the latest plot on Simon Road closes on Oct 2. It is one of 10 confirmed list sites under the H2 2007 GLS Programme. Sites in the programme can potentially yield about 8,000 private homes, of which about 3,000 will be generated from sites on the confirmed list and the remaining 7,000 from reserve list plots.

The government launches reserve sites for tender only upon application by developers with an undertaking to bid at a minimum price acceptable to the state. Confirmed list plots, on the other hand, are released for sale according to a pre-stated schedule, regardless of demand.