A Fernvale Road residential development site received a lot of interest as its tender closed on 27 September. The site on a 99-year lease was bid for by 14 developers.
However, the highest bid was by a consortium of Wee Hur Development and Sing Development of S$287.1m. Following closely was China Construction Development that bid at S$287.09m. The 3rd highest bid was by Allgreen Properties at S$286.9m.
The lowest bidder was Kingsford Property Development who is the developer of Kingsford Waterbay and Kingsford Hillview Peak, with a bid of S$223.23m.
“The reduction of residential sites has reduced the number of unsold stock, arousing the developers’ appetite,” said CBRE Research Head, Southeast Asia and Singapore, Desmond Sim.
He further added that this was reflected by the many bids that the Fernvale plot received, which was reinforced by High Park Residences success in addition to the fact that it is only one site, Pumal Road site, remaining for sale in 2016.
Actually, the first 3 bids for the Fernvale Road site were very close, with the first and the third bids having a difference of 0.007.
Sim added that this indicates that the bidders have a similar outlook on the projects pricing and also in the construction cost control.
Sim further observed that the ability of controling costs is an important factor, especially for the first 2 bidders. This is because they are developers that have a construction arm and they would have accepted the costs related to the prefabricated prefinished volumetric construction – PPVC projects.
The site was launched on August 16, 2016. It has an area of 17,195.9 sq m and can have a total of 605 residential units.
Looking into the future, Sim expects the government to release more residential sites in the next program of Government Land Sales. This is in order to prevent the escalation of land bids.