Results 1 to 6 of 6

Thread: Developers bid big for Margaret Drive site

  1. #1
    Join Date
    Oct 2011
    Posts
    10,829

    Default Developers bid big for Margaret Drive site

    http://www.straitstimes.com/business...ret-drive-site

    Developers bid big for Margaret Drive site

    Dec 7, 2016

    Top offer of $238.39m for the 22,195 sq m residential plot exceeds market forecasts; indicates strong demand

    Lee Xin En


    A residential site in Margaret Drive drew bullish bids from 14 developers eager to replenish their land supply in the last Government Land Sales (GLS) tender for the year.

    The offers for the 22,195 sq m site easily exceeded market expectations, with the super-aggressive one from MCL Land (Regency) catching analysts' eyes.

    It lodged $238.39 million, or $997.85 per sq ft per plot ratio (psf ppr) - 7.9 per cent higher than the second-highest bid from Allgreen Properties at $220.9 million.

    Mr Nicholas Mak, head of research and consultancy at SLP International Property Consultants, noted that the gap between the top and second bids was the widest among residential GLS tenders this year.

    He dubbed the MCL offer "quite bullish", given that it is 14.5 per cent higher than the price of the land parcel where the nearby Queens Peak is being built.
    The price of the Margaret Drive site exceeds that of the land on which nearby Queens Peak (above) is being built.The price of the Margaret Drive site exceeds that of the land on which nearby Queens Peak (above) is being built. PHOTO: HAO YUAN INVESTMENT

    "Such higher land prices and strong participation among developers indicate that many developers are hungry for land," he said.

    The 99-year leasehold site, which had been on the Urban Redevelopment Authority reserve list, was triggered for sale after a developer committed to bid at least $185.758 million. It is located between two MRT stations, Commonwealth and Queenstown.

    Mr Mak said that the 14 offers for the Margaret Drive site followed strong bidding at two previous residential tenders - a Martin Place site drew 13 bids while a Fernvale Road plot attracted 14.

    "This level of healthy demand from developers may encourage the Government to release more residential sites in the next GLS programme, which would be released this month," he added.

    The price of the Margaret Drive site exceeds those of nearby sites such as Commonwealth Towers, which cost $883 psf ppr, and Queens Peak, which cost $871 psf ppr.

    But its relatively small size made it easier to swallow for developers.

    Mr Ong Teck Hui, national director of research and consultancy at JLL, said that the "absolute price" was "much more affordable" compared with the $562.8 million paid for Commonwealth Towers and $483.2 million for Queens Peak.

    The site, which could yield about 300 units, "would also be easier to market than the 845 units in Commonwealth Towers and 736 units in Queens Peak", he added.

    "The reduced development risk would have been a major consideration among potential bidders, resulting in many bidding competitively in today's tender," he said.

    He added that the confident bidding also suggested that bidders are optimistic about the market outlook, "with a possible upside in prices by the time the project is launched for sale".

    Mr Ong Kah Seng, director of property consultancy R'ST Research, said that the Margaret Drive site could be sold at a high pricing. However, it has a very strong edge over its neighbouring sites, he said.

    "A savvy investor will understand that Commonwealth Towers and Queens Peak each has so many units within the project that not only do the owners have to compete for tenants with other condominiums in the vicinity, but there is also intense leasing competition within the large project itself."

    Mr Desmond Sim, head of CBRE Research for Singapore and South-east Asia, noted that the developers in the tender were from a wide variety of countries, including China and Malaysia. "This shows their continued confidence in Singapore's residential market, even as it is challenged by cooling measures," he said.

    Upcoming projects to be launched next year, according to property consulting firm Edmund Tie & Company, include UOL's 505-unit condominium in Clementi, as well as Frasers Centrepoint's Siglap Road development.

    Mr Lee Nai Jia, head of South-east Asia research at Edmund Tie & Company, said that the Siglap Road site is particularly interesting as there have been no new sites in the area since 2001.

  2. #2
    Join Date
    Oct 2011
    Posts
    10,829

    Default MCL Land tops bids for Margaret Drive residential site with S$238.4m

    http://www.businesstimes.com.sg/real...te-with-s2384m

    MCL Land tops bids for Margaret Drive residential site with S$238.4m

    Analysts say the aggressive bidding for the 99-year leasehold land signals that developers are reading the market positively

    Wednesday, December 7, 2016

    by Lynette Khoo

    [email protected]

    @LynetteKhooBT


    MCL Land has emerged top in a fierce contest among 14 bidders for a residential land parcel at Margaret Drive.

    The top bid of S$238.39 million translates to S$997.85 per square foot per plot ratio (psf ppr) based on the maximum gross floor area of the site near Commonwealth MRT station, which is big enough for 275 homes.

    It is also 7.9 per cent higher than the next highest bid, from Allgreen Properties, at S$220.9 million.

    Such aggressive bidding for the 99-year leasehold site signals that developers are reading the market positively "with a possible upside in prices by the time the project is launched for sale", said JLL national director for research and consultancy Ong Teck Hui.

    This land parcel is a Reserve List site under the government land sales (GLS) programme that was triggered for tender, after a developer committed to bid at least S$185.76 million for it last month.

    The breakeven level for the future project to be built on the site, based on MCL Land's top bid, is expected to be about S$1,500 psf, according to sources.

    "The strong participation by 14 bidders and a higher than expected top bid of S$998 psf ppr is not really surprising given the strong attributes of the site, the affordable absolute land price, the hunger for new development sites among developers and positive market sentiments," Mr Ong said.

    The tender results also reinforce the view of some that developers' high bidding interest will encourage the government to release more residential sites in the next GLS programme for the first half of 2017.

    Among them, CBRE research head for Singapore and South-east Asia, Desmond Sim, noted that the huge turnout for this tender shows the insatiable hunger of developers for land, especially those which have not won any sites over the past 12 months.

    "In addition, the palatable quantum for this site allowed for a higher winning margin. It is also presented a possible opportunity for smaller developers," Mr Sim said, adding that the site also drew a wide variety of nationalities.

    SLP International executive director Nicholas Mak pointed out that the 7.9 per cent gap between the highest and second-highest bids represents the widest gap among residential GLS tenders (including executive condominium sites) that closed this year.

    "Many developers who are interested in this site are aware of the potential fierce competition in this tender," Mr Mak said. "In order to have a fair chance to win in this tender, their bids must be bullish."

    Other developers that took part in the tender (in no particular order) included UOL, Tuan Sing Holdings, Frasers Centrepoint Limited, Malaysia's SP Setia International, and Greatview Investment (owned by Beijing's Haojing Investment Group unit and Yu Zhisong).

    Golden Development (owned by the Ng family who founded Far East Organization) tied up with Sekisui House; ZACD Investments joined hands with Maxdin; while TID Residential (a joint venture of Hong Leong Holdings and Mitsui Fudosan Co) tied up with Hong Realty, a vehicle of the Kwek/Quek family.

    The site also drew bids from construction-related developers - namely China Construction (South Pacific) Development Co, a unit of Shanghai-listed China State Construction Engineering Corporation Ltd; Low Keng Huat (Singapore); United Engineers; and Chip Eng Seng's CEL Development.

  3. #3
    Join Date
    Oct 2011
    Posts
    10,829

    Default


  4. #4
    Join Date
    Mar 2014
    Posts
    138

    Default

    Thought everyone has been saying properties will drop and some say will plunge deep deep and recession already here

    How to expect to buy cheap properties if developers keep reaching for the stars in their bids and so many developers fighting for limited land


    Quote Originally Posted by reporter2 View Post

  5. #5
    Join Date
    Dec 2008
    Posts
    3,721

    Default

    No one says you must buy from new launches.

  6. #6
    Join Date
    Jun 2009
    Location
    Southbank
    Posts
    9,531

    Default

    The top bid of S$238.39 million translates to S$997.85 per square foot per plot ratio (psf ppr) based on the maximum gross floor area of the site near Commonwealth MRT station, which is big enough for 275 homes.

    http://www.skyscrapercity.com/showthread.php?t=358211

    The $233 psf per plot ratio price based on UOL's bid price is close to the $245 psf ppr that CapitaLand paid in a state tender in 2003 for a nearby 99-year site next to Lavender MRT Station.

Similar Threads

  1. Margaret Ville located at 20 Margaret Drive From $8xxK
    By Mimi18 in forum Inner City / Southern Coast
    Replies: 0
    -: 30-07-18, 12:15
  2. Replies: 0
    -: 18-04-18, 23:45
  3. Margaret Ville New Launch @ Margaret Drive
    By uncleloh in forum Marketplace
    Replies: 0
    -: 27-01-18, 08:29
  4. Replies: 0
    -: 07-01-18, 11:47
  5. Residential site in Margaret Drive triggered for tender
    By reporter2 in forum Singapore Private Condominium Property Discussion and News
    Replies: 1
    -: 11-11-16, 22:27

Posting Permissions

  • You may not post new threads
  • You may not post replies
  • You may not post attachments
  • You may not edit your posts
  •