Fairly good response seen with modest bids ranging from $200-$300 ppr
A 99-YEAR leasehold condo plot at Tampines Ave 1/10 fronting Bedok Reservoir, launched yesterday by the Urban Redevelopment Authority, is likely to draw modest bids ranging from $200 to $300 per sq ft of potential gross floor area, given tepid developer sales, property consultants say.
Cushman & Wakefield managing director Donald Han reckoned that 'given Singaporeans' affinity for living near water, the site should see fairly good response from developers'. 'I would expect this site to fetch a fair number of bids, maybe about five,' he added.
On the other side of Bedok Reservoir, in a more choice spot, Frasers Centrepoint and Far East Organization are understood to have sold about 140 units at their Waterfront Waves condo. The average price is about $800 psf for reservoir-facing units and around $750 psf for pool-facing units.
'The Waterfront Waves project has better views all round whereas the URA site is kind of tucked in a corner,' Mr Han said.
Assuming a new condo on the latest plot can sell for about $750 psf on average, the land bids will come in at about $280-$300 psf. 'For developers to bid higher than this range, they must be confident of selling the project at above $750 psf or have a sense of controlling costs in a market where construction costs are spiralling upwards,' he added.
CB Richard Ellis director (research) Leonard Tay projected an even lower land price of around $200-$230 psf per plot ratio. He reckoned a new 99-year leasehold project on the site may fetch an average price of around $700 psf, citing resale prices for nearby completed condos, and factoring in higher construction costs.
'Current prices of units in The Tropica, Aquarius By The Park and The Clearwater are within $550 psf and $670 psf, while those at Baywater, a recently completed condominium, are around $600-$680 psf,' Mr Tay added.
Cushman's Mr Han reckoned the latest plot, which has a land area of 341,650 sq ft and a 2.1 plot ratio - the ratio of maximum potential gross floor area to land area - can accommodate a new condo with about 650 units averaging 1,100 sq ft.
URA's latest plot is next to The Tropica, developed by a Hong Leong Holdings unit and completed around 2000.
The tender for the plot closes on Aug 12. It is the penultimate plot to be launched under the first-half 2008 confirmed list of Ministry of National Development's Government Land Sales programme.
The 11th and final plot on the current confirmed list is a 'white' site at Ophir/Rochor roads. Slated for release by the end of this month, the 2.7 hectare plot will be sold with minimum office and hotel components stipulated. MND's H1 2008 GLS programme also includes 26 reserve list plots. Twenty-four of these have been available for application by developers - but not one has been triggered for sale.
The two remaining reserve plots - residential sites in Sengkang West Avenue and Sembawang Road - will be made available for application by month-end. All eyes in the property market are now on the GLS programme for H2 2008, which will be announced by the end of this month.
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