Housing site near Serangoon MRT station up for tender soon

[reporter2]

http://www.straitstimes.com/business/property/housing-site-near-serangoon-mrt-station-up-for-tender-soon

Housing site near Serangoon MRT station up for tender soon

Sep 23, 2015

Chong Koh Ping


A residential development site within a 10-minute walk of Serangoon MRT station will be put up for tender next month.

The 1.4ha, 99-year-leasehold site in Lorong Lew Lian is close to Serangoon town centre, Nex shopping mall and various schools.

The public tender, lasting four to six weeks, will start next month on a date yet to be announced.

The site was on the Govern-ment's reserve list and has been triggered for sale after a developer committed to bid at least $250 million, or $552.90 per sq ft (psf) per plot ratio (ppr), the Urban Redevelopment Authority (URA) said in a statement yesterday. It did not name the developer.

Land parcels on the reserve list are put up for tender only if a developer makes an acceptable initial offer, while confirmed-list sites go on sale regardless of interest.

Some experts said they were surprised that a reserve-list site has been triggered for sale, given the weak demand in the private residential market.

"The developer who triggered the sale may not win the bid after all," SLP International executive director Nicholas Mak said.

"But this shows that attractively located sites in the north-east region are getting rather scarce," he added. He expects at least eight to 12 bidders to participate in this tender.

Cushman & Wakefield research director Christine Li said property developers have recently renewed calls for the Government to tweak or even remove the Additional Buyer's Stamp Duty for Singaporeans buying a second property.

"As General Election 2015 is over, it could be an opportune time for developers to get ready their ammunition in the event that the cooling measures are tweaked," she said.

Some may want to boost their land bank in anticipation of the tweaks, she added.

Given that the site is located in a quiet neighbourhood lined with private houses and yet not far away from amenities and major transport nodes - it is served by two MRT stations, Bartley and Serangoon - Ms Li expects the tender prices for the Lorong Lew Lian land parcel to range between $670 and $720 psf ppr.

"The Botanique at Bartley near Bartley MRT station had been sold at a median price of $1,282psf since its launch in the second quarter.

I think that's the price the developer will be benchmarking against," she said.

[reporter2]

http://www.businesstimes.com.sg/real-estate/lor-lew-lian-housing-site-triggered-for-tender

Lor Lew Lian housing site triggered for tender

Commitment received to bid at least S$553 psf ppr for the 1.4 ha reserve list plot near Serangoon MRT

By Kalpana Rashiwala

[email protected]@KalpanaBT

Sep 23, 2015


FOR the first time in about 21 months, a private housing site on the reserve list of the Government Land Sales (GLS) Programme has been triggered for release.

Located in Lorong Lew Lian, near Serangoon MRT Station and Nex mall, the plum 99-year leasehold site can be developed into a private condo project with about 465 units, based on estimates stated in the current H2 2015 GLS Programme.

The S$250 million minimum bid price undertaking given by an unnamed developer that made the successful application for the site's release, translates to S$552.93 per square foot of potential gross floor area.

The 1.4-hectare site is bounded by Lorong Lew Lian, Upper Serangoon Road and Upper Paya Lebar Road and has a 3.0 plot ratio (ratio of maximum gross floor area to land area).

The Urban Redevelopment Authority said on Tuesday that it would launch the tender for the site next month; the tender period will be about four to six weeks.

Wong Xian Yang, OrangeTee.com senior manager of research and consultancy, expects good response for the site given its proximity to amenities as well as the encouraging take-up for UOL Group's Botanique at Bartley condo, one MRT stop away.

Based on URA's monthly developer sales data, 62 per cent or 495 of Botanique at Bartley's 797 units were sold as at the end of August. UOL released the project in early April this year.

Mr Wong predicts six to 12 bids for the Lorong Lew Lian site, with the top bid likely to be somewhere in the S$630-680 per square foot per plot ratio (psf ppr) region. He estimates the average selling price for the new project on the site at S$1,250-1,300 psf.

R'ST Research director Ong Kah Seng reckons that the site would fetch five to nine bids, with the highest likely to be around S$590-630 psf ppr. This would translate to a breakeven cost of around S$1,100 psf and expected average selling price of S$1,300-1,350 psf.

Savills Singapore research head Alan Cheong reckons that units in the new condo could fetch about S$1,400 psf on average, considering the site's proximity to Serangoon MRT Station, which is an interchange station, and Nex. Based on this, he predicts land bids to be as high as S$700-800 psf ppr.

"The upper end of this range could well be achievable because developers are out to replenish land banks and the absolute price quantum of this land parcel, being in the S$300 million-plus level, is within range of quite a few mid to large-sized developers and consortiums," he added.

Mr Cheong said that the successful bidder of the site was likely to build up to 600 units for the project based on the minimum average size of 70 square metres (about 753 sq ft) for Outside the Central Area sites.

Some market observers mused that news of the Lorong Lew Lian site being triggered from the reserve list appears to run counter to the bleak picture of the Singapore private housing market painted at last week's Mid-Autumn Festival lunch organised by the Real Estate Developers' Association of Singapore as it urged the authorities to tweak the property cooling measures.

Putting things in perspective, a seasoned industry player said: "There are many developers that have run out of land. Lorong Lew Lian is an upper-middle type of location and given the more subdued market, some developers without any land bank figure it will be easier for them to secure a site."

They could be in for a disappointment at the actual tender, suggested Savills's Mr Cheong. "The site, being so close to recently tendered out GLS sites in the Kovan and Bartley area, creates an ideal condition where developers that won in these earlier tenders, submit bids to defend their existing projects - something that academics call 'game theory'."

Mr Cheong was alluding to Cheung Kong's winning bid of nearly S$849 psf ppr at a tender that closed in November last year for a "residential with first storey commercial" site near Kovan MRT Station, and UOL Group's S$648 psf ppr winning bid in January 2014 for the Botanique at Bartley condo site.

Making a counter-argument, another property consultant said that even developers that are stuck with unsold units in existing projects but with deep pockets could be keen to buy new land at a lower price with the aim of selling the units at a lower price to generate some cashflow for the business.

"On the other hand, if they stayed put and did nothing, the pressure would mount on them to chop prices for existing projects - if they need to generate sales and cashflow."

[Moneyplant]

Thinking of purchasing 1 bedder for investment in this project next year (Reasons : Nex, 400M to MRT station Purple & Orange Lines, Future Serangoon Sub Regional Centre and Private Enclave). Do you think est 420 sqf unit will be possbile under budget of $600K or should I just look for resale projects instead the neighbourhood eg. space @ kovan if chance wouldn't be high? I prefer full condo facilities rather than apartment.

[henryhk]

Thinking of purchasing 1 bedder for investment in this project next year (Reasons : Nex, 400M to MRT station Purple & Orange Lines, Future Serangoon Sub Regional Centre and Private Enclave). Do you think est 420 sqf unit will be possbile under budget of $600K or should I just look for resale projects instead the neighbourhood eg. space @ kovan if chance wouldn't be high? I prefer full condo facilities rather than apartment.

The Serangoon condo looks better, nearer Nex and mrt ....just hope it doesn't price too high Lor, .... Convenience to food and mall, and mrt is most important wen buying condo! Can nver go wrong

[Moneyplant]

Thanks for your advise. That's what I thought too, although kinda tempted by some surroundings freehold status apartments compared to this 99 yrs. But for rentals, I think most tenants would prefer condo facilities. Will be keenly waiting for the tender results before deciding whether should be continue searching for a good buy apartment below $600K in the vicinity.