http://www.straitstimes.com/archive/...-bids-20141009

Prime Thomson site draws 18 bids

Highest number for private residential plot in over a year; top bid is $173.6m

Published on Oct 9, 2014 1:17 AM

By Rennie Whang


A PRIME site in the Thomson area has drawn a crowded field of 18 bids - the highest number for a private residential plot in more than a year.

Market watchers say high demand for homes in the area probably sparked the fierce tussle for the 113,051 sq ft parcel in Lorong Puntong, off Sin Ming Avenue.

The high number of bids was no surprise given the relatively small plot size which meant offers under $200 million, said CBRE research head Desmond Sim. "It also presents a good opportunity for a new player to put in a competitive bid to enter the market."

The last time a private residential site saw such fierce competition was in June last year at Faber Walk, which also drew 18 bids. That site is being developed into the Waterfront@Faber project.

Chinese and Hong Kong developers joined Singapore firms like Sing Holdings and Allgreen Properties in the battle for the Thomson site, with China-based Nanshan Group emerging on top.

It tendered $173.57 million or $731.10 per square foot per plot ratio (psf ppr), edging out SL Capital Ventures ($161.89 million or $681.90 psf ppr) and Sing Holdings and Maxdin (joint bid of $161.80 million or $681.53 psf ppr).

Last month, Nanshan signed a $270 million agreement to buy the former Midlink Plaza in Middle Road, which it will develop into a hotel.

The companyhas taken part in four government land sales tenders this year - three executive condominium sites and one mixed-use development plot, said SLP International research head Nicholas Mak.

The estimated breakeven price for a new condominium on the Thomson site could be from $1,240 to $1,310 psf, he added.

The Nanshan Group's bid of $731.10 psf ppr pips the $719.9 psf ppr paid by Singapore Land and UOL Group for the nearby Thomson Three site in August 2012, said Mr Ong Teck Hui, JLL national research director.

Mr Lee Liat Yeang, real estate lawyer at Rodyk & Davidson, told The Straits Times: "Developers probably saw the success of Thomson Three sales and concluded there was pent-up demand for Thomson area properties."

Thomson Three had sold 413 of 445 units at an average price of about $1,355 psf as at Aug 31.

Consultants said the new site's proximity to Ai Tong School and the proposed Bright Hill station on the Thomson Line were attractions while sites in mature private estates are hard to come by.

"While the residential market is slowing and recent tenders are seeing fewer bidders and more cautious bidding, developers are still keen on attractive sites and would try to secure them," said Mr Ong of JLL.

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