State tender for Holland Rd site draws 15 bids

[reporter2]

State tender for Holland Rd site draws 15 bids


The land parcel is divided into two zones: Zone 1 for residential development, and Zone 2 for commercial and/or serviced apartment uses. Observers expect it could take about two months before URA awards the site.ST PHOTO: AZIZ HUSSIN

Mar 21, 2018

Some developers place more than one bid for commercial and residential site

Kalpana Rashiwala


A state tender for a plum 99-year leasehold commercial and residential site in Holland Road closed yesterday after attracting 15 bids.

Some developers placed more than one bid with different concept proposals for the site, in order to boost their chances of clinching it.

Under the dual-envelope concept and price tender mode for the site's sale, the Urban Redevelopment Authority (URA) released only the bidders' names but not their bid prices.

A consortium with Far East Organization, an affiliated company and Sekisui House put in three bids.

Three consortiums placed two bids each: Lendlease in a tie-up with Pontiac Land; Perennial Real Estate Holdings in partnership with Qingjian Realty; and GuocoLand in partnership with Hong Leong Holdings' fully owned unit Intrepid Investments, TID and Hong Realty.

The rest of the bidders, with one bid each, were City Developments, in partnership with RB Capital; Allgreen Properties in partnership with Kerry Properties; UOL Group, teaming up with United Industrial Corporation; CapitaLand, in partnership with Hotel Properties; SingHaiyi Group in a tie-up with its controlling shareholder Haiyi Holdings; and Chip Eng Seng in partnership with Roxy-Pacific Holdings and JBE Properties.

Bidders were required to submit their concept proposals and tender prices in two separate envelopes. Under this system, only the envelopes containing concept proposals were opened yesterday.

A Concept Evaluation Committee will first review the proposals against the criteria of quality of the design concept, quality of the public realm, and track record. Only those that substantially satisfy the criteria will be shortlisted for the second stage of the tender evaluation.

At this stage, the price envelopes of proposals with acceptable concepts will be opened for consideration. The site will then be awarded to the tender with the highest bid.

The Holland Road site can have a maximum gross floor area (GFA) of 59,715 sq m, of which up to 13,500 sq m can be used for retail. The URA has set a cap of 570 residential units for the project. At least 60 per cent of the total GFA should be for residential use, and the remaining 40 per cent may be for commercial use.

The land parcel is divided into two zones: Zone 1 for residential development, allowing for flats, serviced apartments and/or strata landed houses; and Zone 2 for commercial and/or serviced apartment uses. Dual "office/residential" use units may be allowed.

Market watchers expect it could take about two months before URA awards the site. The successful bidder will have seven years to complete the project.

JLL national director Ong Teck Hui said the response reflected the attractiveness of the site, the upturn in the residential and commercial property sectors and the stabilising retail property segment. "As expected, many major players submitted bids with a number of them as consortiums. The huge capital outlay with a land price possibly exceeding $1 billion and the necessary experience in developing and managing the non-residential component would have led to the tie-ups."

ZACD Group executive director Nicholas Mak noted the presence of Chinese developers in this tender. "These developers were primarily developing residential projects in Singapore. Now they appear to be ready to expand into commercial development and possibly hold such commercial developments for investment. They will be giving other Singapore developers a run for their money."

[reporter2]

Far East-led consortium places 3 of total 15 bids for Holland site

Wed, Mar 21, 2018

Kalpana Rashiwala


PROPERTY giant Far East Organization - which has been lagging its rivals in a land shopping binge in the past year or so - is leading a consortium that has placed three bids for a prime commercial and residential site in Holland Road.

The Urban Redevelopment Authority's first dual-envelope tender in eight years drew a strong turnout on Tuesday. In all, 15 bids were received from 10 consortiums for the 99-year leasehold site near Holland Village MRT Station. Four of the groups placed multiple bids to raise their chances of clinching the site.

"The huge capital outlay with a land price possibly exceeding S$1 billion and the necessary experience in developing and managing the non-residential component would have led to the tie-ups," said JLL national director Ong Teck Hui.

URA released the names of the bidders on Tuesday evening but not the bid prices, in accordance with rules for the dual-envelope concept and price tender mode for the site's sale.

Far East Organization was joined by an affiliated company and Sekisui House. Three other groups placed two bids each: Lendlease in a tie-up with Pontiac Land; Perennial Real Estate Holdings in partnership with Qingjian Realty; and GuocoLand in partnership with Hong Leong Holdings' fully-owned unit Intrepid Investments, TID and Hong Realty.

The rest of the bidders placed one bid each. They include City Developments, in partnership with RB Capital; Allgreen Properties in partnership with Kerry Properties; and UOL Group, which teamed up with United Industrial Corporation.

Also bidding were CapitaLand, in partnership with Hotel Properties; SingHaiyi Group in a tie-up with its controlling shareholder Haiyi Holdings; and Chip Eng Seng in partnership with Roxy-Pacific Holdings and JBE Properties.

Cushman & Wakefield research director Christine Li pointed to the site's rarity appeal; it can be developed into a mixed-use project near a major transport node and cater to the luxury segment. "The recent spate of collective sales in the prime districts in the first three months of the year could have spurred more interest in the Holland Road site.

"With land costs firmly on an upward trend, fuelled by both state tenders and en bloc sales, the eventual bid price for Holland Road could surprise on the upside."

Bidders were required to submit their concept proposals and tender prices in two separate envelopes. Only the envelopes containing concept proposals were opened on Tuesday.

The concept proposals should demonstrate how the proposed development on the land parcel will address the following evaluation criteria: quality of design concept, quality of public realm, and track record.

A Concept Evaluation Committee (CEC) will first evaluate the concept proposals against the evaluation criteria. Only those that substantially satisfy the evaluation criteria will be shortlisted by the CEC for the second stage of the tender evaluation.

At the second stage, the price envelopes of proposals with acceptable concepts will be opened and the site awarded to the tenderer with the highest bid.

The Holland Road site can have a maximum gross floor area (GFA) of 59,715 square metres (642,766 sq ft), of which up to 13,500 sq m can be used for retail. The URA has also set a cap of 570 residential units for the project.

At least 60 per cent of the total GFA should be for residential use and the remaining 40 per cent may be for commercial use.

The land parcel is divided into two zones. Zone 1 is intended for residential development. The types of housing units that can be allowed in this zone are flats, serviced apartments and/or strata landed houses.

Zone 2 is intended for commercial and/or serviced apartment uses. Dual "office/residential" use units - whereby each unit is allowed to be used for both office and/or residential uses interchangeably without planning permission - may be allowed as part of this zone.

No strata subdivision is allowed in Zone 2.

When the site was launched last December, consultants forecast winning bids ranging from S$1,300 per square foot per plot ratio (psf ppr) to as high as S$1,900 psf ppr - translating to S$836 million to S$1.2 billion.

However a market insider told BT last night that bids above S$1,600 psf ppr may be bullish. "Those who have made predictions in this range may not have factored in a few key constraints on the proposed development. "One is the enormous complexity of the construction, for example the need for the developer to build underground carparking across the entire site in addition to constructing some bridges, roads and underpass.

"Furthermore, it will be hard to divest the component on Zone 2, assuming the developer has multiple property types such as retail, serviced apartments, offices - as no sale will be allowed in the first five years after the project's completion. Taking into account the long-term nature of Zone 2, the winning bidder needs to factor in the rising interest rate environment."

Ms Li of Cushman and Wakefield said that "while most developers would want to ride on the residential boom and use the sales proceeds at the pre-launch to fund the subsequent development, developers opting for serviced apartments have an edge over the rest in the price tender due to the higher capital values of serviced apartments".

The 2.3-hectare plot is the first state land sale site launched as part of the Holland Village Extension plan unveiled in URA's 2014 Master Plan.

Market watchers expect that it could take about two months before URA awards the site. The successful bidder will be given seven years to complete the project.

JLL's Mr Ong said the response to the tender was not unexpected given the attractiveness of the site, the upturn in residential and commercial property and the stabilising retail property.

CBRE Research head of Singapore and South East Asia Desmond Sim said: "As it is a mixed development, as well as a GLS site, the tender presents greater opportunities, and a quicker, clean-cut acquisition process for developers compared with participating in a collective sale."

ZACD Group executive director Nicholas Mak noted that at least two China-originated developers participated in this tender, namely Qingjian and SingHaiyi. "These developers were primarily developing residential projects in Singapore. Now they appear to be ready to expand into commercial development and possibly hold such commercial developments for investment... They will be giving other Singaporean developers a run for their money."

[CCR]

Any guess how much will be the land price psf ppr? 1800?

[Kelonguni]

With the extensive commercial component, it is sure to exceed 2000 PSF, maybe even over 2200 PSF.

I wished they released it in 2014 without much hooha. Would certainly have invested here!

Now, it will just be plainly unaffordable to me.

[PropVestor]

With the extensive commercial component, it is sure to exceed 2000 PSF, maybe even over 2200 PSF.

I wished they released it in 2014 without much hooha. Would certainly have invested here!

Now, it will just be plainly unaffordable to me.

You are already vested so you are in a better position than those who have not. What goes up will also come down.

We need to play our game right. It might be attainable to you sometime down the line when you liquidate some of your assets so you are still very much in the game.

[bargain hunter]

With the extensive commercial component, it is sure to exceed 2000 PSF, maybe even over 2200 PSF.

I wished they released it in 2014 without much hooha. Would certainly have invested here!

Now, it will just be plainly unaffordable to me.

gahmen won't sell prime land cheap one...

[teddybear]

gahmen not even selling land, just leasing out the land as 99-years lease only, so using the word "sell" is a misnomer (and misleading to 99-years leasehold property buyers!)

gahmen won't sell prime land cheap one...

[Kelonguni]

Everyone can see how the 99 LH game is playing out to be more than sufficient for most.

As long as enbloc within 40, 50 years. Even Pearlbank also got sold.

gahmen not even selling land, just leasing out the land as 99-years lease only, so using the word "sell" is a misnomer (and misleading to 99-years leasehold property buyers!)

[CCR]

I wonder those who never buy in the last two years and claim property market will stay in the doldrums because of cooling measures and tight immigration policies and Aging population etc, what are their thots now?

In the next one to two years new launches will be

OCR >1500psf
Good OCR and freehold locations >1800 psf
RCR > 2000 psf
Good RCR and freehold > 2200 psf
Ccr >2500 psf
Holland ccr > 2800 psf
Luxury ccr >3500 psf

[HP65]

I wonder those who never buy in the last two years and claim property market will stay in the doldrums because of cooling measures and tight immigration policies and Aging population etc, what are their thots now?

In the next one to two years new launches will be

OCR >1500psf
Good OCR and freehold locations >1800 psf
RCR > 2000 psf
Good RCR and freehold > 2200 psf
Ccr >2500 psf
Holland ccr > 2800 psf
Luxury ccr >3500 psf

What you have forecasted above are probably new launch prices. What would be your take on those less than 10 yrs old resale? I’m just curious to see what are sentiments on the ground like.

[Kelonguni]

Yes, people who blatantly denied the obvious unfolding of the trend should come in and explain their current position and plans.

I wonder those who never buy in the last two years and claim property market will stay in the doldrums because of cooling measures and tight immigration policies and Aging population etc, what are their thots now?

In the next one to two years new launches will be

OCR >1500psf
Good OCR and freehold locations >1800 psf
RCR > 2000 psf
Good RCR and freehold > 2200 psf
Ccr >2500 psf
Holland ccr > 2800 psf
Luxury ccr >3500 psf

[Arcachon]

What you have forecasted above are probably new launch prices. What would be your take on those less than 10 yrs old resale? I’m just curious to see what are sentiments on the ground like.

If you are a investor, what will you buy, Resale or New Launch.

[teddybear]

Resale and Freehold better bargain now.

If you are a investor, what will you buy, Resale or New Launch.

[CCR]

For fairly new resale if can get 20% below new launches I feel.will be a good buy...

For older freehold resale if can get at > 30% discount to new launches will be good buy

I think D10 extremely underpriced as compared to D9 and D11, although the quantum is bugger as lost D10 units are much bigger, the psf pricing is ridiculous at 1700 psf on average excluding the ardmour area, it's the same psf pricing as new launches at OCR, I believe strongly the Holland makeover will trigger Holland area pricing to catch up with the market...

Singaporeans like to act w the herd, with land prices costing upwards of 1600 psf at Holland area, New launches will.be at least 2600 psf...

[CCR]

I will definitely buy resale freehold if it's >20% below new launch prices

[CCR]

Yes, people who blatantly denied the obvious unfolding of the trend should come in and explain their current position and plans.

My question was not to challenge those who had a bearish view of Singapore property prices...

But with discussions and debate we all will,become more informed..

So it will be great to find out what are the plans for this who did not managed to act in the last two years when the market seem like it's never going to recover...

I read somewhere that the Singapore working population will start to shrink by 2020, I am fairly certain after the next election the floodgates will open irrespective of the political cost to the gahmen as its will,be a disaster for Singapore to have a shrinking working population...

With thomson east coast line up by 2023 and all.hdb and bto demand met and plenty of malls built, and 1 billion dollars of additional busses, i believe the infrastructure will support bigger population..

Can fellow forummers who have not bought or position themselves for this upturn comment on what are their plans?

Continue to wait for the next downturn then act on it? Quickly buy now in view that prices will rise another 20% in the next few years? Or wait another year to see if this is a false dawn?

[august]

My question was not to challenge those who had a bearish view of Singapore property prices...

But with discussions and debate we all will,become more informed..

So it will be great to find out what are the plans for this who did not managed to act in the last two years when the market seem like it's never going to recover...

I read somewhere that the Singapore working population will start to shrink by 2020, I am fairly certain after the next election the floodgates will open irrespective of the political cost to the gahmen as its will,be a disaster for Singapore to have a shrinking working population...

With thomson east coast line up by 2023 and all.hdb and bto demand met and plenty of malls built, and 1 billion dollars of additional busses, i believe the infrastructure will support bigger population..

Can fellow forummers who have not bought or position themselves for this upturn comment on what are their plans?

Continue to wait for the next downturn then act on it? Quickly buy now in view that prices will rise another 20% in the next few years? Or wait another year to see if this is a false dawn?

Did not act because of ABSD and TDSR.

[CCR]

Thanks for sharing...

That's a tough one, I guess it's not because you did not act but rather you can't act..

So I presume u can't act now as well with market moving up?

Anyone else never position for this upturn when they can do it and what's the plan ahead?

[HP65]

If you are a investor, what will you buy, Resale or New Launch.

No matter where I look, I still see value in resale. Especially those less than 10 years old. Not too old to pose maintenance issues, yet can rent out after minor touch up.

New launch was good 1-2 years back. I bought despite ABSD. Vested 1 at D15 and D3. In addition, I’m already heavily vested in D10 and D9. Indeed I’m starting to see interests in my D10 propoerties picking up. Agent also cold call me to ask if I’m looking to sell as they have ready buyers who has been enbloc recently.

[ccreporter]

With ABSD (10%) for me now, shall i purchase if i can get loan?...

[CCR]

Resale offer value and the gap is big w the enbloc prices, so buy resale now is good in my opinion, I am sure resale will catch up w new condo prices

[Arcachon]

Resale offer value and the gap is big w the enbloc prices, so buy resale now is good in my opinion, I am sure resale will catch up w new condo prices

Resale are for investor and those with lot of money.

New launch are for those who are not here nor there.

[Arcachon]

With ABSD (10%) for me now, shall i purchase if i can get loan?...

You should ask yourself how many 10 years you have left.