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Thread: CDL top bidder for two of three private housing sites

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    Default CDL top bidder for two of three private housing sites

    CDL top bidder for two of three private housing sites

    Jan 31, 2018

    Developer offers $212m for Handy Road plot, $472m for West Coast Vale site in state tender

    Kalpana Rashiwala



    City Developments (CDL) was the top bidder for two of the three private housing sites at a state tender that closed yesterday.

    It lodged the top bid of $212.2 million, or $1,722 per sq ft per plot ratio (psf ppr), for a plot in Handy Road near Dhoby Ghaut MRT station.

    The developer also bid $472.4 million, or $800 psf ppr, for a land parcel in West Coast Vale.

    The third site on offer - in Chong Kuo Road in the Sembawang/Mandai area - received a top bid of $43.95 million, or $681 psf ppr, from a partnership between Lian Soon Holdings and OKP Land.

    CDL group chief executive Sherman Kwek said: "We... see great potential in the two sites... As Singapore's residential market begins to gradually recover, we will continue to seek suitable opportunities to increase our local land bank."

    The firm said it will explore developing three residential towers - eight to 10 storeys high - with about 200 apartments and a basement carpark for the Handy Road site. It will convert a conservation building on the site into a clubhouse.

    The West Coast Vale site could house two 36-storey towers. The Urban Redevelopment Authority has stipulated a maximum of 730 residential units for this plot.

    The tender for the Handy Road site drew 10 bids, while the Chong Kuo Road site received eight, and the West Coast Vale plot got six.

    CDL's bid for the Handy Road plot - the most attractive of the three sites because of its District 9 location off Orchard Road - was 12.3 per cent higher than the next offer, from Sing Essential, believed to be linked to Hong Kong parties.

    The bid price was also just 0.6 per cent shy of the benchmark price of $1,733 psf ppr that was set for the Jiak Kim Street site awarded to Frasers Centrepoint last month, noted Colliers International's head of Singapore research Tricia Song.

    She estimates CDL's break-even cost for a Handy Road project at $2,300 psf and reckons the group could be looking at an average selling price of $2,650 psf.

    "Nearby, the 493-unit, 99-year leasehold Sophia Hills was 95 per cent sold as of December last year and median prices have increased to $2,127 psf in December from an average of $1,900 psf to $2,000 psf earlier," she said.

    CDL's bid for the West Coast Vale plot was 35 per cent higher than the $592 psf ppr paid for the site of the yet-to-be-launched Twin View project, Ms Song noted.

    The adjacent 752-unit Parc Riviera was 97 per cent sold as of last month at an average price of $1,200 psf, within 13 months of its launch in November 2016. This could have increased the confidence of developers in the location, despite the abundant supply, said Ms Song.

    She estimates CDL's break-even for the West Coast Vale plot at $1,250 psf and an average selling price of $1,400 psf to $1,500 psf. The group's bid was just 0.7 per cent more than the next highest bid, by China Construction (South Pacific) Development.

    CDL is no stranger to the West Coast area, having developed Monterey Park Condominium and Hundred Trees.

    The top bid for the Chong Kuo Road site was just 0.1 per cent more than the second highest.

    The simultaneous tender closings for three sites appear to have had little impact in tempering bid prices, said property consultants.

    JLL national director Ong Teck Hui said: "Bidding for all three sites was bullish, with top bids exceeding or at the top end of expectations.

    "This is despite the batch tender closing, which did not seem to temper bidding in any way, as well as the availability of collective sale sites on the market."

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    Multiple tender closings, but bids still bullish

    Top bids for three private housing sites with tenders closing on the same day pull in bids exceeding or at higher end of expectations: property consultants

    Wed, Jan 31, 2018

    Kalpana Rashiwala


    THE Urban Redevelopment Authority's batched tender exercise, or simultaneous tender closings, for three 99-year private housing sites does not seem to have tempered bullish bids by developers, say some property consultants.

    In the exercise which closed on Tuesday, property giant City Developments Ltd (CDL) emerged as the top bidder for two of the three sites.

    For a plot in Handy Road near Dhoby Ghaut MRT station, it bid S$212.2 million, which works out to S$1,722 per square foot per plot ratio (psf ppr); for a land parcel in West Coast Vale, it bid S$472.4 million or S$800 psf ppr.

    The third site on offer in Tuesday's tender was along Chong Kuo Road in the Sembawang/Mandai area. A partnership between Lian Soon Holdings and OKP Land placed the top bid of S$43.95 million or S$681 psf ppr.

    The tender for the Handy Road site drew 10 bids; the Chong Kuo Road site received eight bids, and the West Coast Vale plot, six.

    For the Handy Road plot - in District 9 and the most attractive of the three land parcels because of its location off Orchard Road - CDL's bid was 12.3 per cent higher than the next highest offer from Sing Essential, believed to be linked to Hong Kong parties. Its directors include Kino Law and Raymond Law Ka Kui, the founders of K&K Property.

    CDL's bid price was just shy of the benchmark price of S$1,733 psf ppr set for the Jiak Kim Street site, which was awarded to Frasers Centrepoint last December, noted Colliers International head of Singapore research, Tricia Song.

    She estimates CDL's break-even cost for the future project on the Handy Road site at S$2,300 psf, and reckons that the group could be looking at an average selling price of S$2,650 psf.

    "Nearby, the 493-unit, 99-year leasehold Sophia Hills was 95 per cent sold as of December 2017, and median prices there increased to S$2,127 psf in December from an average of S$1,900-S$2,000 psf earlier," she added.

    Also bidding for the site were Cheung Kong-linked Japura Development, Wing Tai, Sustained Land, unlisted units of Hong Leong Group, Kheong Leong Company and Hoi Hup Realty (in partnership with Sunway Developments).



    For the West Coast Vale plot, CDL's top bid was 35 per cent higher than the S$592 psf ppr paid in February last year for the site of the yet-to-be-launched Twin View project, Ms Song noted.

    The adjacent 752-unit Parc Riviera was 97 per cent sold as of December 2017 at an average price of S$1,200 psf, within 13 months of launch in November 2016. This could have increased the confidence of developers in the location, despite the abundant supply, she said.

    She estimates CDL's break-even for the West Coast Vale plot at S$1,250 psf and its average selling price to be between S$1,400 and S$1,500 psf. The group's bid was just 0.7 per cent more than the next highest bid by China Construction (South Pacific) Development Co; also bidding for the site were UOL Group (in partnership with United Industrial Corporation), Qingjian Realty, EL Development and unlisted units of the Hong Leong Group.

    CDL is no stranger to the West Coast area, having developed Monterey Park Condominium and Hundred Trees.

    The top bid for the Chong Kuo Road site was just 0.1 per cent higher than the second highest bid, believed to be from TG Development. Wee Hur Development, Fantasia (West) (a unit of Fantasia Holdings group) and Kheng Leong were among the other bidders who vied for the plot.

    JLL national director Ong Teck Hui said: "Bidding for all three sites was bullish, with top bids exceeding or at the top end of expectations. This is despite the batch tender closing, which did not seem to temper bidding in any way, as well as the availability of collective sale sites on the market. The top bidders seemed to have priced in an increase of 10 to 20 per cent in unit prices from current levels."

    CDL's group chief executive Sherman Kwek said: "We have been very selective and see great potential in the two sites.... As Singapore's residential market begins to gradually recover, we will continue to seek suitable opportunities to increase our local land bank."

    If awarded the two sites, CDL said it will explore developing three residential towers for the Handy Road site. These will be eight to 10 storeys high and house about 200 apartments and a basement car park. A conservation building on the site will be converted into a clubhouse.

    For the West Coast Vale site, the group envisages two 36-storey towers; the Urban Redevelopment Authority has stipulated a maximum of 730 residential units for this plot.

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