A residential site of 22,195 sq m located in Margaret Drive received bullish bids from 14 property developers in their bid to replenish their supply of land.
The bids exceeded the expectations of the market analysts, with MCL Land being the most aggressive one with a bid of $238.39m ($997.85 psf ppr); which was 7.9% more than the second bid of $220.9m by Allgreen Properties. MCL Land is also the developer for Lake Grande condo.
“The gap between the first two top bids was the widest this year among residential GLS tenders,” said Mr. Nicholas Mak SLP international head of research.
He considered MCL offer bullish since it was 14.5% higher than the price Queens Peak’s site nearby. He considered the strong participation by developers as hunger for land.
The Margaret Drive’s 99-year leasehold land is between Queenstown and Commonwealth MRT stations. A developer’s bid of at least $185.758m triggered the sale of the site; which was on the URA reserve list.
Mr. Mak also noted that two other sites had attracted strong bids with Fernvale Road site drawing 14 bids and Martin Place site attracting 13 bids. This should encourage the government to have more sites this month in the next GLS program.
While the Margaret Drive site had a higher price in comparison to nearby sites such as Queens Peak which had cost $871 psf ppr ($483.2m) and Commonwealth Towers that had cost $883 psf ppr ($562.8m), its absolute price was more affordable due to its small size.
“The site with a yield of approximately 300 units was easier to market than Queens Peak with 736 units and Commonwealth Towers with 845 units,” he added.
He added that the competitive bidding could have been due to the bidders considering reduced development risk and optimism about the property market outlook.
According to Mr. Desmond Sim CBRE head of Research, the fact that bidding developers were from different countries including Malaysia and China was an indication of confidence in the residential market of Singapore even with the cooling measures.
~ New project names are subject to confirmation.