Hao Yuan submits highest bid of $441 mil for Bernam Street GLS site
By Cecilia Chow
/ EdgeProp Singapore |
Ask Buddy
SINGAPORE (EDGEPROP) - The Government Land Sales (GLS) site on Bernam Street attracted four bids at the close of the tender on September 5. The top bid of $440.9 million came from Chinese developer Hao Yuan Investments, and translates to a land cost of $1,463 psf per plot ratio (psf ppr). Desmond Sim, CBRE head of research for Southeast Asia says the top bid is "not surprising" as the developer's last residential project is the 736-unit Queens Peak, with the 99-year, leasehold site purchased in a GLS tender in June 2015.
The second highest bid came from Hongkong Land and MCL Land, with Far East Organization in third place followed by Chinese developer CSC Land and partners, notes Sim.
Bids received for the GLS site on Bernam Street
Source: URA
Based on the bid price of $1,463 psf ppr submitted by Hao Yuan, Christine Li, Cushman & Wakefield (C&W) head of research for Singapore and Southeast Asia, estimates the breakeven price for the new project to be about $2,100 psf, with selling price of around $2,430 psf, assuming a 15% profit margin.
“Developers could have taken note of the encouraging sales at the nearby Sky Everton,” says Li. The 262-unit, freehold project saw 160 units sold within a month of its launch in June this year. Based on caveats lodged to date, the average transacted price achieved at Sky Everton was around $2,541 psf, she adds.
Nearby 99-year leasehold private residential properties in the Tanjong Pagar area that could have been used as references by bidders include Skysuites @ Anson and Altez, where median transacted prices from January to August 2019, were $2,066 psf and $2,247 psf respectively, notes Nicholas Mak, ERA Realty head of research & consultancy.
![GLS BERNAM STREET - Nearby 99-year leasehold private residential properties in the Tanjong Pagar area that could have been used as references by bidders include Skysuites @ Anson and Altez (pictured on the left) [Photo: Samuel Isaac Chua/EdgeProp Singapore]](https://sg.tepcdn.com/public/usr/1hrsv2/42a5fe-BLD-HMLET-APARTMENTS-TANJONG-PAGAR-VIEW-AC.JPG)
Nearby 99-year leasehold private residential properties in the Tanjong Pagar area that could have been used as references by bidders include Skysuites @ Anson and Altez (pictured on the left) [Photo: Samuel Isaac Chua/EdgeProp Singapore]
The most recent launch of a 99-year leasehold condo in the vicinity was One Pearl Bank in the neighbourhood of Outram MRT station by CapitaLand. The median transacted price was $2,359 psf, estimates ERA’s Mak.
With a maximum gross floor area (GFA) of 301,403 sq ft, Ong Teck Hui, JLL senior director of research & consultancy, estimates the new project on Bernam Street could yield some 325 residential units with commercial space on the first storey.
“The site is within the area under the CBD Incentive Scheme, so more mixed commercial residential redevelopments arising from the scheme would increase the supply of residential units in the vicinity, posing greater competition,” notes Ong.
The GLS site on Bernam Street is located next to Realty Centre which was sold en bloc for $148 million in April this year (Photo: Cushman & Wakefield)
Competition could come from the neighbouring Realty Centre, a freehold office site, which was sold en bloc for $148 million in April this year, says C&W’s Li. Assuming the site is eventually redeveloped into a new commercial and residential project, under the CBD Incentive Scheme, it would enjoy a bonus 25% increase in plot ratio and could potentially yield around 60 units (assuming 60% is for residential use and an average unit size of 70 sqm), she estimates. This translates into a land cost of around $1,922 psf ppr, before any development charges, she adds.
However, the Bernam Street site enjoys good locational attributes, given its proximity to two MRT stations - Tanjong Pagar MRT station and the upcoming Prince Edward MRT station – as well as its location within the CBD, notes Li.
CBRE’s Sim adds: “In the long run, this residential development will also benefit from plans for the Greater Southern Waterfront.”
Read also:
Ask Buddy
Follow Us
Follow our channels to receive property news updates 24/7 round the clock.
EdgeProp Telegram
EdgeProp FacebookSubscribe to our newsletter
Top Articles
Search Articles