Two sites up for tender to yield 1,160 homes
Landed site in Hougang set to see keen interest from small- to mid-sized players
Friday, April 21, 2017
by Lynette Khoo
A PLUM landed plot in Hougang at Lorong 1 Realty Park and a large non-landed site at Stirling Road have been launched for sale, with consultants expecting keen demand for both.
The plot in Hougang, which can yield 50 landed homes, is expected to be a bigger draw for small- and mid-sized developers, market watchers said.
Developers can choose to build conventional landed housing or strata-landed housing on the 1.34 ha site in the mature landed enclave of Hougang. The 99-year leasehold site is on the Confirmed List of the Government Land Sales (GLS) programme.
The Stirling Road land parcel is a Reserve List site that was triggered for sale last week after a developer committed to bid at no less than S$685.25 million or S$718 per square foot per plot ratio (psf ppr). But it is likely to deter smaller players given its size - it can yield an estimated 1,110 units.
Based on projections by property consultants, the Lorong 1 Realty Park site may draw a top bid in the region S$420-580 psf. They are now expecting the top bid for site at Stirling Road to draw six to 14 bids with the top bid coming in at S$780-1,000 psf.
JLL head of Singapore research and consultancy Tay Huey Ying said the site at Lorong 1 Realty Park might see a better turnout given its more palatable price quantum, its location within the mature Upper Serangoon area and, most importantly, the dearth of sites for landed development.
The last time a landed site was sold under the GLS programme was in June 2013, when the Victoria Park Villas parcel was awarded after being hotly contested by 12 bidders, she recalled.
Concurring, SLP International executive director Nicholas Mak said he is expecting this sole landed housing development site in the H1 2017 GLS programme "to be fiercely fought over".
"There is a significant number of small- and medium-sized developers and contractor-developers who are hungry for suitable development sites," he said, adding that he's expecting as many as 25 to 32 bids.
"The site's positive attributes, such as its location within a landed enclave and its proximity to the Hougang MRT Station, would also attract much interest from developers."
According to CBRE Research estimates, 99-year leasehold terrace houses in the neighbourhood are currently transacted in the resale market at S$1.5-2 million.
Notwithstanding strong locational attributes, the Stirling Road site may be confined to bidders with the financial muscle and risk appetite.
Cushman & Wakefield research director Christine Li said this is due to the requirement to sell out all units within five years from the date of land purchase in order to meet the conditions for remission on additional buyers' stamp duty.
"This could mean that even though developers are keen, they might have to form consortium in order to take on the site," she said.
JLL estimates that there are currently more than 1,500 unsold units in nearby launched and yet-to-be-launched projects including unsold units at Commonwealth Tower, Queens Peak, Alex Residences, soon-to-be launched Artra and a project in Margaret Drive.