Allgreen is top bidder for Handy Rd site

Published March 29, 2007

Allgreen is top bidder for Handy Rd site

By KALPANA RASHIWALA


MAINBOARD-listed Allgreen Properties has emerged top bidder for a 99-year leasehold site in Handy Rd near The Cathay with an offer of $72.3 million or $669 per square foot per plot ratio.

The 38,600 sq ft site, near Dhoby Ghaut MRT Station, is designated for residential use or residential use with first-storey commercial space. It can be developed into a 10-storey project with maximum gross floor area of 108,080 sq ft.

The Urban Redevelopment Authority's tender exercise had attracted four bids when it closed yesterday.

Alliance Development - controlled by Sino Holdings, not linked to property magnate Ng Teng Fong's Far East Organization or Sino Land group - bid almost $70.4 million.

GuocoLand's Rivaldo Investments offered $68.65 million. And Peak Venture, controlled by banker Wee Cho Yaw, tendered $50.5 million.

CB Richard Ellis executive director Li Hiaw Ho estimates Allgreen's breakeven cost for a new project on the site could be around $1,000 psf.

'Going by current prices of units at 8 @ Mount Sophia at above $1,000 psf in the subsale market, and those at the freehold Nomu selling at $1,100-1,300 psf, it is likely that the new project on the Handy Rd site will be able to sell at an average price of around $1,300 psf,' he said.

March 29, 2007

Allgreen puts in top bid of $72.3m for Handy Road site

By Joyce Teo, Property Correspondent


ALLGREEN Properties has put in the highest bid of $72.3 million for a thin strip of residential land on Handy Road, next to Plaza Singapura.

A new residential development on the site - a short distance from Orchard Road - would enhance the area's vibrancy and boost property values, say analysts.

The Urban Redevelopment Authority tender for the 3,586 sq m site closed yesterday after drawing four bids. The second-highest bid of $70.4million came from Alliance Development. The other two bids were $68.65 million and $50.5 million.

Allgreen's bid works out to $669 per sq ft (psf) of potential gross floor area.

Some consultants had expected higher bids as they reckoned that a new development could sell for as much as $1,500 psf to $1,600 psf.

Mr Li Hiaw Ho, executive director of CB Richard Ellis Singapore, said Allgreen's bid is 'reasonable' and works out to a break-even price of about $1,000 psf. The 99-year leasehold site has a height limit of 10 storeys and a maximum gross floor area of 10,041 sq m.

Mr Li said the units of the new project on the site are likely to be sold for $1,300 psf on average.

This takes into account that sub-sale prices of units in the neighbouring 8 @ Mount Sophia project have risen above $1,000 psf and those at the nearby 50-unit freehold Nomu development are selling at $1,100 psf to $1,300 psf.

The site for Fraser Centrepoint's 8 @ Mount Sophia, which achieved an average price of $730 psf in 2005, cost just $280 psf.

'The new project will be attractive to home owners and investors because it is strategically located next to Dhoby Ghaut MRT Station,' said Mr Li. It is also close to The Atrium At Orchard, the cineplex at The Cathay and the Singapore Management University campus.

The Cathay has 76 apartments for lease on levels nine to 17. And when the new condos are ready, the area will have more residents.

The area could liven up further if the collective sales of older mixed developments Peace Centre and Parklane Shopping Mall around the corner succeed.

Peace Centre and the adjoining Peace Mansion were just recently put up for sale at an indicative price of $470 million.

GOOD LOCATION

'The new project will be attractive to home owners and investors because it is...next to Dhoby Ghaut MRT Station.'
MR LI, of CB Richard Ellis