URA Awards Woodlands Site To Soilbuild

Source : The Business Times, July 25, 2008

THE Urban Redevelopment Authority (URA) yesterday awarded a Woodlands industrial site to top bidder Soilbuild Group Holdings - two days after the tender closed on Tuesday.

But for a tender last week for a hotel site in Balestier Road that drew three bids - all below market expectations - there is no announcement yet from the URA on its decision.

'The government is evaluating the bids for the Balestier Road site,' a URA spokeswoman said when asked about the outcome of this tender.

On Wednesday last week, HH Properties, a joint venture between Hiap Hoe and sister company SuperBowl Holdings, placed the top bid for the 99-year leasehold Balestier plot - about $172 per square foot of potential gross floor area (psf ppr).

This was way below the $350-470 psf ppr that analysts indicated when the site was launched in late March - and much less than the $420-805 psf ppr at which the government awarded 99-year hotel sites last year.

The Balestier site is opposite the Sun Yat Sen Nanyang Memorial Hall.

The Woodlands site awarded to Soilbuild is the tenth that the company has garnered since it moved into the business space sector in 2005 to complement its residential development activity. The 180,835 sq ft site, at Woodlands Industrial Park E5, comes with a 60-year lease.

Soilbuild, which bid $13.61 million or $30.10 psf ppr, said yesterday that the total development cost including land would be $35-40 million. It will fund the purchase from internal resources and through bank borrowings. Development could take about 20 months, with factories slated for completion by 2010.

Soilbuild is targeting SMEs for these factories, which can be used for clean/light industry, general industry and warehousing. It does not expect the project to have a material financial impact on its consolidated net tangible assets per share or consolidated earnings per share in the current financial year ending Dec 31.

With the Woodlands plot, Soilbuild has six business space projects in the pipeline, totalling more than 3.5 million sq ft.

Soilbuild shares closed unchanged at 96 cents yesterday.