Muted bidding expected for Bishan, Sembawang sites

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http://www.businesstimes.com.sg/arch...sites-20140819

Published August 19, 2014

Muted bidding expected for Bishan, Sembawang sites

Consultants point to unsold private homes, upcoming ECs in Sembawang

By lee meixian

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THE government yesterday released for sale two residential sites - one at Lorong Puntong off Sin Ming Avenue and another executive condo (EC) site at Sembawang Road-Canberra Link.

Both are in the confirmed list, under which sites are launched according to schedule, regardless of demand.

The Lorong Puntong site has a land area of 10,503 square metres and can yield a maximum gross floor area (GFA) of 22,056 sq m - about 280 homes.

Consultants are divided on how the plot will do in the tender. While SLP International executive director Nicholas Mak is expecting 12 to 18 bids, RST Research director Ong Kah Seng is forecasting a more conservative turnout of just five bids. Both put the winning range at about S$620-680 psf per plot ratio (ppr).

Mr Mak believes that with limited upcoming supply of private residential-zoned land in the Sin Ming, Bright Hill and Bishan area, the Lorong Puntong site can be considered "attractive". The "fairly small" site will likely attract small and medium-sized developers, he said.

But Mr Ong drew reference from a Bright Hill Drive site which sold for S$720 psf ppr in 2012 and has been developed into the Thomson Three condo. Given its 18 per cent winning margin (which hints at over-bidding), and taking into account loan caps and developers having had to trim prices for Bishan town centre projects such as Sky Vue and Sky Habitat, he expects the Lorong Puntong site to receive more "realistic" interest.

The Sembawang EC site is a large 28,746 sq m plot and has a maximum GFA of 60,366 sq m which can yield about 605 homes.

Consultants expect lukewarm bidding to culminate in three to seven bids, with a winning offer of about S$300-330 psf ppr.

Mr Mak noted that two nearby EC sites sold earlier - at Canberra Drive and Sembawang Avenue - make up a large supply pipeline that will challenge this latest site. Sales at the Skypark Residences EC at Sembawang Crescent have also been slow, with only three-fifths of its units sold since its launch in October.

"There is some sense of over-saturation of new private homes and ECs in the immediate vicinity within the far-flung Sembawang. The balance unsold units will be carried forward to 2015, so developers tendering for sites which will be launched from 2015 will factor in these risks of added sales competition," said Mr Ong.

The tender for the Lorong Puntong site closes on Oct 8 while that for the Sembawang EC site ends on Sept 30.

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http://www.straitstimes.com/archive/...ender-20140819

Two residential sites put up for tender

Thomson, Sembawang plots can yield about 900 homes in total

Published on Aug 19, 2014 1:36 AM

By Melissa Tan


TWO development sites that will collectively yield about 900 homes were put up for sale in state tenders yesterday.

One is a small private residential plot near Thomson Plaza that consultants believe could be fairly attractive to developers.

The other is an executive condominium (EC) site in Sembawang, which is expected to draw a more lukewarm response.

Both plots are on 99-year leaseholds.

The 113,051 sq ft parcel in Thomson is at Lorong Puntong, close to the upcoming Bright Hill MRT station as well as Ai Tong School, which is under construction. It is expected to yield about 280 private homes.

Although consultants agreed that its location was more attractive than that of the Sembawang EC site, they differed widely on whether developers would bid aggressively for the plot.

"With limited upcoming supply of private residential-zoned land for sale in the Sin Ming, Bright Hill and Bishan area, the Lorong Puntong site can be considered an attractive site," said SLP International research head Nicholas Mak.

He said that since the land parcel was relatively small, some small and medium-sized developers would be keen on bidding for it given its lower total land cost.

Mr Mak said there could be as many as 12 to 18 bidders, with the top bid coming in at between $152 million and $162 million. This works out to $640 to $682 per sq ft (psf) per plot ratio (ppr).

However, R'ST Research director Ong Kah Seng predicts that there will be only around five bids, with the top bid coming in at $620 to $670 psf ppr.

Mr Ong noted that a nearby land parcel at Bright Hill Drive, which has since been turned into the Thomson Three condominium, fetched a top bid of $720 psf ppr when it was sold in 2012 before tough home loan curbs were rolled out last year under the total debt servicing ratio framework.

The top bid for the Lorong Puntong parcel would therefore likely be 10 per cent less, or around $650 psf ppr, he said, "unless there is a high-risk-taking developer banking on a possible lifting of cooling measures in, say, a year down the road".

Consultants agreed that the developers would likely be less keen on the Sembawang EC site, at the junction of Sembawang Road and Canberra Link.

Demand for ECs, which are a hybrid of public and private housing, has gone down ever since loan caps for the segment were imposed late last year.

They expect the 309,418 sq ft plot to draw three to seven bids, with a top bid of $300 to $331 psf ppr.

Another EC in the district, SkyPark Residences in Sembawang Crescent, was launched last year and only 306 out of the 506 units available had been sold by the end of last month.

The Sembawang EC site tender closes on Sept 30 and that for the Thomson plot closes on Oct 8.

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