SINGAPORE (EDGEPROP) - An undisclosed developer has triggered the release of a residential site, labelled Zion Road (Parcel B), which will be launched for sale via public tender next month, according to an April 22 press release from URA.

The Zion Road (Parcel B) plot is a reserve site on the 1H2024 Government Land Sales (GLS) programme. Sites under the Reserve List are not released for tender immediately but are initially made available for application. It will be put up for tender only when a developer submits an application with an acceptable minimum price.

In this case, the site was triggered when the unnamed developer had submitted a bid not lower than a minimum price of $604.57 million.

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The 99-year leasehold site occupies 0.9ha and is expected to yield up to 610 private residential units. With a maximum permissible gross floor area (GFA) of about 559,744 sq ft, the application price works out to a land rate of about $1,080 psf per plot ratio (ppr) based on GFA. The site is close to Great World and Havelock MRT stations, Great World City, Zion Riverside Food Centre and River Valley Primary School.

URA’s acceptance of this bid price is unsurprising, says Wong Siew Ying, head of research and content at PropNex Realty, given that it is lower than the winning bid for an adjacent Zion Road plot (Parcel A) that was awarded earlier this month to a joint venture between Singapore-listed property group City Developments and Japanese real estate developer Mitsui Fudosan, The joint venture submitted a sole bid of $1.107 billion. The 99-year leasehold site is the first to pilot long-stay serviced apartments with a minimum stay of three months, and can yield 1,170 residential units, including 435 long-term serviced apartments.

However, Wong did not expect that the Zion Road (Parcel B) site would be triggered so soon, in view of the recent tender award of the Zion Road (Parcel A) site and a nearby residential plot in River Valley Green (Parcel A) that is still open. “This could reflect developers’ confidence in the home buying demand in that area, given the site’s attractive location near two MRT stations and amenities such as the Great World City mall,” Wong notes.

She adds that the developer that triggered the Reserve List site could also be seizing the opportunity to apply for the plot at a more measured price, amid the cautious market sentiment.

Lee Sze Teck, senior director of data analytics at Huttons Asia, agrees that the triggering of the site may reflect developers’ confidence in the site and in the property market, particularly for a pure residential site than one that incorporates a long-stay serviced apartment element. “Selling residential homes is more straightforward and carries lesser risks compared to undertaking a newer venture,” he observes.

“Developers may also see the potential of the sites at Zion Road, and that there is sufficient demand for homes in the area, despite potential competition from the River Valley Green (Parcel A) site,” Lee says.

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Given that the recent land tender outcomes at Zion Road (Parcel A) and Orchard Boulevard have been “lacklustre” and awarded at “relatively conservative prices”, Wong opines that upcoming land bids could moderate. She expects the Zion Road (Parcel B) site to receive two or three bids, and the top price could come in at around $1,150 to $1,250 psf ppr.

Similarly, Lee expects up to three developers participating in the tender for Zion Road (Parcel B), with the top bid for the site priced between $1,100 and $1,200 psf ppr.