West Coast Sea-Facing Condo Site Launched

Source : The Business Times, January 24, 2008

URA site likely to attract top bids of $260 to $400 psf ppr, say analysts

THE Urban Redevelopment Authority (URA) yesterday launched the tender for a 99-year-leasehold condo site next to Blue Horizon condo facing West Coast Park and overlooking the sea.

Property consultants generally expect the site at West Coast Crescent to attract widespread interest from developers given its strong attributes - the plot can be built into a new condo up to 36 storeys high boasting nice views of surrounding parks and the sea and just a 10-minute drive away from shopping and entertainment attractions at VivoCity, St James Power Station and Sentosa.

However, the range of likely top bids for the 1.2ha site with a 2.8 plot ratio (ratio of maximum potential gross floor area to land area) indicated by consultants polled by BT yesterday varied widely - from $260 to $400 per square foot (psf) of potential gross floor area.

At the high end, Savills Singapore director (marketing and business development) Ku Swee Yong predicts top bids for the site will be around $380-$400 psf of potential gross floor area, working out to absolute bid quantums of about $137 million to $145 million.

This will result in a breakeven cost of about $750-$800 psf for the new condo. 'The developer should be able to achieve an average selling price of about $900-950 psf assuming the new project is launched next year,' Mr Ku added.

He reckons units in the condo should enjoy strong demand from both owner occupiers as well as those seeking to rent out their units to expats, including Japanese, given the site's proximity to the Waseda Shibuya Senior High School.

'The western part of Singapore is attracting a lot of foreign investments from the petrochemical and pharmaceutical industries, among others.

'The area is also near National University of Singapore, one north, and Science Park. So high-income professionals, researchers and engineers would be keen on living in the condo,' Mr Ku said.

Agreeing, Knight Frank director (consultancy and research) Nicholas Mak added that the new condo will have views of West Coast Park, Clementi Woods and the sea, and yet be close to the CBD. 'The District 5 site's developer can count on demand from both the upgrader/mass market and mid-tier buyers,' Mr Mak argues.

He expects the plot to attract three to six bids, with top bids in the $270-$310 psf ppr range, translating to breakeven cost of about $650-690 psf. 'The developer would be looking at a likely average selling price of around $740-780 psf,' Mr Mak added.

CB Richard Ellis executive director Li Hiaw Ho says that units at Blue Horizon next door were transacted in the resale market at an average $750 psf in Q4 last year. 'Taking into consideration the award of a high-rise condo site in Boon Lay Way at $248 psf ppr in December 2007, it's likely the mid-range of bids for the latest plot will come in at around $260-280 psf ppr, resulting in a break-even cost of around $600-650 psf. However, top bids may be higher than this, depending on market conditions at the time of the tender close.'

The site can be developed into a condo with about 300 units averaging 1,250 square feet. The tender for the plot closes on March 19.