May 30, 2007
Bids could pass $1b mark for Marina Bay site
BLUE-CHIP property players from across the region are expected to do battle for a prime piece of Marina Bay land released for tender yesterday.
Bids of well above $1 billion - although one expert tips $2 billion or more - are expected for the 1.02ha site behind One Shenton and The Sail@Marina Bay condominiums.
A project of about 40 storeys can be built on the land, but 70 per cent of the gross floor area must be given over to offices. The rest of the space can hold more offices, hotel rooms, homes or shops.
Mr Nicholas Mak, the director of research and consultancy at Knight Frank, expects bids to come in at between $830 million and $1.09 billion, based on recent government land sales and an assumed rental yield of about 6.5 per cent to 7.5 per cent.
This range works out to $580 to $760 per sq ft per plot ratio (psf ppr), he said.
But Ms Tay Huey Ying, Colliers International's director of research and consultancy, expects even higher bids - 'upwards of $1 billion, or $750 psf ppr', with the winning bid 'likely to be above $2 billion'.
The likely contenders 'include all the major local blue-chip developers', Mr Mak said.
These would be CapitaLand, Keppel Land, Lippo Group, Far East Organisation and City Developments, which is the developer behind One Shenton and The Sail.
Foreign funds could also tie up with local developers for the tender bid, he said.
The consortium building the nearby Marina Bay Financial Centre (MBFC) - Keppel Land, Hongkong Land and Cheung Kong Holdings - may also be interested, said consultants.