Strong interest seen in Farrer Drive site

[reporter2]

http://www.businesstimes.com.sg/arch...rer-drive-site

Published May 12, 2012

Strong interest seen in Farrer Drive site

Analysts expect top bid in the $850-1,100 psf ppr range, with final selling prices of $1,700-1,800 psf

By Kalpana Rashiwala


ANYWHERE between 10 and 20 developers could make a beeline for a plum 99-year private housing site at Farrer Drive, next to Sommerville Grandeur and just a few minutes' walk from the Farrer Road MRT Station. The site has been triggered from the government's reserve list.

While the high-end residential market has been quiet, developers eyeing the prospects of building small-format apartments to keep the lump-sum apartment prices relatively affordable would find the District 10 plot attractive. Another draw is the site's manageable size with the all-in development cost estimated at about $166 million based on the top end of pricing expectations for the plot.

These estimates from property consultants came after the Urban Redevelopment Authority announced yesterday that an unnamed party has made a successfully application for the site's release with a commitment to bid at least $88.888 million ($823.33 per square foot of potential gross floor area) at tender. Analysts forecast the winning bid could fall in the $850-1,100 per square foot per plot ratio (psf ppr) range.

The 67,471 sq ft plot, with a 1.6 plot ratio (ratio of maximum gross floor area to land area), can be built up to eight storeys and some market watchers say it could potentially yield about 100-200 apartments, depending on unit size mix.

International Property Advisor chief executive Ku Swee Yong, estimates the winning bid could be as high as $1,100 psf ppr, which would translate to a breakeven cost of about $1,550 psf. "The project's average selling price could be around $1,700-1,800 psf assuming it comprises mostly one and two-bedder apartments. Just the first 20 per cent payment from buyers - assuming all the units are sold before construction begins - could be enough to cover the construction costs." he added.

Mr Ku estimates the all-in development cost at about $166 million - considered a relatively bite-sized quantum which should draw construction companies, boutique developers and some of the bigger players as well to participate in the tender for the site. He expects 10-20 bids.

Savills Singapore research head Alan Cheong predicts "at least 10-15 bids", pointing out that "any plot in the $100 million range will attract a swarm of bidders". He predicts the winning bid could be around $930 psf ppr, or $100 million.

CBRE executive director Li Hiaw Ho, who's expecting 15-20 bids, reckons the top bid could be around $1,000 psf ppr, translating to a breakeven cost of about $1,450-1,500 psf and selling price of around $1,700 psf on average, assuming the project includes a fair number of small-format units.

Giving a more cautious take, Credo Real Estate executive director Ong Teck Hui predicts "realistic bidding" as bidders will factor the supply overhang in prime districts. He predicts the top bid at $850-950 psf ppr.

"The average price of units up to eight storeys in a new project nearby is about $1,500 psf," he added, alluding to d'Leedon. The 36-storey project has a whopping 1,715 units ranging from one-bedroom-with-study to four-bedroom apartments as well as 12 strata semi-detached houses.

Mr Ong also described the latest Farrer Drive plot on offer as a "remnant infill site sandwiched between existing condominiums but having an attractive District 10 address". It will be a smallish development with low absolute land price which makes it affordable to even smaller developers, he adds.

URA will launch a tender for the site in about two weeks. The plot was made available for application on the reserve list less than a month ago, on April 16.

Analysts say this is one of the two choicest pure-residential sites on the current Government Land Sales Programme. The other, which was made available for application on April 30, is at Farrer Road, next to Lutheran Towers and a short distance from Botanic Gardens MRT Station. It is an even smaller plot at about 29,530 sq ft and 1.4 plot ratio. "I wouldn't be surprised if that site is triggered for release soon," said Mr Ku.

[reporter2]

http://www.straitstimes.com/Money/St...ry_797994.html

Farrer Drive housing site to be put up for tender

Published on May 12, 2012

By Amanda Tan


A RESIDENTIAL site in Farrer Drive will be launched for sale by public tender in about two weeks.

The 0.63ha site was made available for sale through the reserve list system last month, and received an application from a developer recently.

The developer, whose identity has not been disclosed, committed to bid a minimum of $88.9 million for the land parcel.

Unlike confirmed list sites, which go on sale regardless of interest, reserve list sites go up for tender only if a developer makes an acceptable initial offer.

The 99-year-leasehold residential site will be able to yield about 120 to 150 units and can be built up to eight storeys. It has a maximum permissible gross floor area of 10,030 sq m.

Property consultant Nicholas Mak expects four to nine bids for this plot, and estimated that bids will range from $89 million to $94 million, or $825 to $870 per sq ft per plot (psf ppr) ratio. He said the developer who wins this tender will have paid a high price, and is likely to build small units to maximise the sale.

Mr Mak, who is the head of research at SLP International Property Consultancy, said the application bid is the highest, in terms of psf ppr, in the history of the Government Land Sales programme in Singapore.

'The usual strategy used by most developers to trigger reserve list sites for tender is to submit a low application bid that would be accepted by the Government... In this case, the party (probably hopes) that it would discourage other developers from participating,' he said.

But the plot has attractive features, given that it is in prime district 10 and near amenities and established schools.

Still, Mr Mak expects a sizeable group of buyers to be investors, as he believes the units will be small.

'If they build the more ordinary three-bedroom type, then families will buy, but they are not going to live in shoebox apartments,' he said.

[august]

good grief, all the shoebox developers will rush in.

[radha08]

good grief, all the shoebox developers will rush in.

like it or NOT...shoebox is here to stay...

[DKSG]

like it or NOT...shoebox is here to stay...

As long as you see those foreginers at the middle mgt positions, restuarant managers, engineers, blah blah blah, there will be shoebox units.

Plus of course confused locals who prefer to stay in shoebox than HDB.

DKSG