GuocoLand top prospective buyer for Lentor Central site; Tampines EC site sets price record


Jul 23, 2021






RESIDENTIAL land prices continue to increase, showing developers' positive outlook on private home prices and continuing appetite for land, going by the current state land tender closings.

GuocoLand became the highest bidder for a plot beside the upcoming Lentor MRT station on the Thomson-East Coast Line (TEL); the site is designated for private real estate development with commercial space at first floor. GuocoLand's bid of S$ 784.1 million, or S$ 1,204 per square foot per plot ratio (psf ppr) exceeded the expectations of residential or commercial property experts surveyed by BT prior to the tender close.

The tender for the other plot that likewise closed the very same day, for an executive condo or EC site in Tampines Street 62, saw a fresh record price for EC land, toppling the S$ 603 psf ppr set in May for a plot in Tengah Garden Walk.

In the most current tender, the top bid for the Tampines plot was S$ 422 million or S$ 659 psf ppr, surpassing the projections of the majority of residential or commercial property experts. The top bid was 1.4 per cent higher than the 2nd highest offer, from Intrepid Investments and TID Residential, of S$ 650 psf ppr.

The tenders for both plots drew 9 bids each.

JLL senior director of research and consultancy, Ong Teck Hui, stated: "The current go back to Phase 2 (Heightened Alert) has actually not dampened demand for sites, as it is most likely viewed as a short-term event while existing tender sites might be introduced for sale a year or more later in the middle of favorable market conditions.

" The eager tender involvement and positive top bids are a sign of strong demand for property sites by developers to renew their land banks."

In comparable vein, PropNex CEO Ismail Gafoor stated: "The resilient home prices and healthy purchasing demand likewise show the strength of the real estate market, and this has in turn enhanced developers' self-confidence."

For the Lentor Central plot, the top bid by GuocoLand - part of Malaysian magnate Quek Leng Chan's Hong Leong Group of Malaysia - was 4.5 percent greater than the 2nd highest bid of S$ 1,152 psf ppr, from a tie-up making up Intrepid Investments, Hong Realty and TID Residential; the trio belong to the Hong Leong Group Singapore, helmed by Mr Quek's Singaporean cousin Kwek Leng Beng.

Remarkably, the 3rd highest bid, at S$ 1,131 psf ppr, was from a tie-up between City Developments Ltd (CDL) and Hongkong Land unit MCL Land. CDL is the SGX-listed residential or commercial property and hotel arm of Hong Leong Group Singapore.

CBRE's head of research for Southeast Asia, Tricia Song, kept in mind that the top 3 bids for the Lentor plot exceeded the S$ 1,118 psf ppr winning bid for the private real estate plot in Ang Mo Kio Avenue 1 at the May state tender, showing "agreement confidence in the Lentor site due to its distance to a MRT station, a lack of brand-new supply in the location, and its location in a tranquil low-rise estate".

That stated, Lam Chern Woon, head of research and consulting at Edmund Tie & Co, highlighted that the 9 bids gotten for the Lentor plot is less than the 15 bids for the Ang Mo Kio Avenue 1 site in May. The high absolute price quantum for the Lentor plot vis-a-vis the S$ 381.4 million top bid for the Ang Mo Kio site, might have discouraged smaller sized developers.

GuocoLand's proposed plan for the Lentor Central plot visualizes a mixed-use, transit-oriented development of 25 floors with around 600 homes with the benefit of having a significant quantity of F&B and retail area, consisting of a grocery store and more than 10,000 sq feet of child care centers. "Located in the Thomson location that has actually mainly landed houses, locals will likewise take pleasure in unblocked views of the surrounding locations. Living there likewise implies having huge quantity of nature reserves and parks in proximity," stated GuocoLand's representative.

The plot is likewise near well-known schools such as Presbyterian High School, Anderson Primary School, and CHIJ St Nicholas Girls' School.

Qingjian Realty, which heads the consortium that positioned the record top bid for the Tampines Street 62 EC site, stated it is "extremely positive in the Tampines location as it is a mature estate".

" In preparing for about 600 units, we visualize a great mix of various bed room types, from 2 to five-bedders," stated Qingjian Realty's deputy general manager, Yen Chong.

ERA Realty Network's head of research and consultancy, Nicholas Mak, anticipates that the consortium would need to release the project at above S$ 1,250 psf. "The present average negotiated prices for brand-new EC units offered by developers in Q2 2021 is S$ 1,154 psf. This new land price will make all the existing EC projects reasonably inexpensive by contrast."

Mr Ismail anticipates the launch price for the EC on the Tampines Street 62 plot at S$ 1,150-1,250 psf.

When it comes to the Lentor Central plot, he estimates the possible market price for the future development at S$ 1,950-2,000 psf.