Jurong West Landed Plot Not Awarded

Source : The Business Times, March 19, 2008

THE government yesterday said that it’s not awarding a landed housing parcel in Jurong West - because the bids were too low.

When the tender for the 151,759 square foot site closed this month, there were just two bids. And the higher of the two was a low $11.8 million - or just $77.80 per square foot - in what was taken as a sign of an uncertain property market. That bid, from Boon Keng Development, was significantly below the $200-$250 psf of land area that analysts reckoned the site could fetch.

The other bid came from Sunway Concrete Products, a unit of Malaysia-listed Sunway Holdings. It offered $10.3 million, or $68.10 psf of land area.

Property analysts said then that there was a chance the government would not award the site, as has happened before when the highest bid was too low.

In January, for example, the government decided not to sell a short-term office site at Aljunied because the sole bid was too low. The move followed a string of lower-than-expected offers for state land.

‘The decision is expected on the Jurong site, as the top bid was well below the market rate,’ Cushman & Wakefield managing director Donald Han said yesterday. ‘It would not have been justifiable to award the site, as it would have been a shockwave in terms of market value in that area.’

It is estimated that 50 to 60 landed homes can be built on the 99-year leasehold site in Westwood Avenue.