Wednesday, June 18, 2008

Tampines Residential Site Up For Tender

Source : The Straits Times, June 18, 2008

Offer seen as acid test for property market after recent signs of upswing

A NEW home site on offer in Tampines, overlooking Bedok Reservoir, could shape up as an acid test for the property market after recent signs of a revival.

The Urban Redevelopment Authority (URA) yesterday invited developers to submit bids for the 3.2ha site at the junction of Tampines avenues 1 and 10.

Some property consultants said the 99-year leasehold site's suburban location meant completed homes could command prices of up to $700 per sq ft (psf), which is slightly higher than neighbouring condominiums.

They say the land could fetch anywhere between $107 million and $165 million.

The site, with a maximum gross floor area of 66,655 sq m, is next to The Tropica condo, where caveats show recent deals were done for between $547 psf and $622 psf, or $590,000 to $1.13 million.

Other nearby condos include Aquarius By The Park, The Clearwater and the recently completed Baywater, which fetched $600 psf to $680 psf.

Mr Leonard Tay, director of research at CBRE, said: 'Based on these comparables and taking into account higher construction costs, we expect that a new 99-year leasehold project in this location may fetch prices of around $700 psf.'

This would translate to a possible land price of $200 to $230 psf per plot ratio for the site, he added.

But some others expect a more cautious response, in view of the current fairly quiet market and the risk of falling prices.

On Monday, the URA released figures showing that private home sales had rebounded from the previous months' lows. But the sales were still way below last year's figures.

Consultants such as Ms Tay Huey Ying of Colliers International said the upswing in activity could be the result of developers testing the market with launches.

Mr Ku Swee Yong, Savills Singapore's director of business development and marketing, said bids for the Tampines plot could come in as low as $150 to $180 psf per plot ratio.

At this price, the successful developer could sell the apartments for $650 psf to $700 psf, he added.

Although the site fronts Bedok Reservoir, not all the apartments will have a view of the lake, said Mr Ku.

Mr Tay said that as the site is on the north-western boundary of Tampines New Town, it is about five to 10 minutes' drive from Tampines Central and Tampines MRT station.

Residents can also head for Tampines Retail Park on Tampines Avenue 10, where Giant, Ikea and Courts are located, he added.

The tender for the Tampines site will close on Aug 12.

It is a confirmed list site under the Government's land sales programme. These sites go on sale on specified dates.

The Government also sells land under a reserve list, in which sites are put up for sale only after developers have indicated interest by committing to a minimum bid.

This month, the Government is expected to announce its land sales programme for the second half of the year.


Some consultants expect the site to fetch prices of $200 to $230 psf per plot ratio. But others expect a more cautious response, saying bids could come in as low as $150 to $180 psf per plot ratio.

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