http://www.straitstimes.com/archive/...month-20131217

5 residential sites to be released this month

They include 2 EC sites in Choa Chu Kang; first on offer since new rules

Published on Dec 17, 2013

By Cheryl Ong


FIVE residential sites able to yield about 3,000 homes will be released for sale to developers by the Government this month.

They include two executive condominium (EC) sites in Choa Chu Kang where experts expect somewhat more cautious bidding given last week's tightening of EC loan rules. They are the first EC sites on offer to developers since the new rules came in.

Those two, along with sites at Yishun Avenue 9 and Sims Drive, are on the confirmed list of sites which automatically go to tender.

The other one, at Geylang East Avenue 1, was on the reserve list. A developer put in an initial bid of at least $95 million, which proved acceptable to the Government and triggered the tender.

Industry watchers expect moderate interest in the sites.

Mr Nicholas Mak, SLP International's research head, said the largest site at Sims Drive is attractive given its proximity to the Aljunied MRT station and amenities such as the Sims Vista Market and foodcourt. He expects the 99-year leasehold plot to draw interest from six to 11 developers, with a winning bid of $550 to $631 per sq ft (psf) per plot ratio (ppr).

The 257,257 sq ft site is able to yield about 900 units but this could deter some developers as demand has been dampened by stricter loan rules since July.

R'ST Research director Ong Kah Seng noted that fewer buyers are able to finance pricey homes.

He added that developers keen on the area might look to a nearby plot in Geylang East Avenue 1 instead. The smaller Geylang plot - at 67,146 sq ft - is able to yield about 215 units.

The 99-year leasehold site's manageable size is expected to attract a higher number of bidders, including smaller developers with no appetite for the big parcel in Sims Drive, said Mr Mak who expects seven to 12 bids, with a winning offer of $580 to $650 psf ppr.

Any condo built on the Yishun Avenue 9 site is expected to draw buying interest from Housing Board upgraders in the area, said Mr Ong.

The 221,239 sq ft site is able to yield 685 units, and is within walking distance of future mixed-use development Junction 9.

Experts estimated four to eight bids for the parcel, with a winning bid of $390 to $431 psf ppr.

The two EC sites in Choa Chu Kang Grove will be a test of developers' reaction to the tighter loan curbs introduced to the EC market last week.

Mr Mak said while ECs should continue to be popular with buyers, developers are likely to lower prices at new launches.

He said financing is now markedly tighter after monthly mortgage payments were capped at 30 per cent of a buyer's monthly pay.

Both EC sites are about 177,120 sq ft and are able to yield about 575 units each.

They are expected to draw about four to eight bids each, with a top bid of $330 to $370 psf ppr.

The site at Sims Drive will be launched for sale on Dec 30, while the rest were put up for sale yesterday.

[email protected]