More government land sites rolled out for sale

By Angela Teo

/ EdgeProp |

November 5, 2017 12:00 PM SGT

On Oct 31, URA announced that it would launch for sale at a future date the 1.85ha Fourth Avenue residential site on the Reserve List. “This is one of the more attractive sites on the Reserve List of the current Government Land Sales [GLS] programme,” says Nicholas Mak, executive director of ZACD Group. A developer had triggered the site for sale after it committed to bid at no less than $448.8 million ($1,249.92 psf per plot ratio) for the site.

This means the Fourth Avenue site is the second Reserve List site to be triggered for sale in just two months. The previous site that was triggered was the 1.35ha residential site (with commercial on the first level) on Jiak Kim Street at Robertson Quay. A developer had committed to submitting a minimum bid of $689.353 million ($1,250 psf ppr).

Analysts are expecting bullish bids for the Fourth Avenue site, which is adjacent to the Sixth Avenue MRT station and in the established residential estate of Bukit Timah. The site, which has a gross floor area (GFA) of 359,066 sq ft, can be developed into a 455-unit residential project. Mak expects the Fourth Avenue site to draw 10 to 15 bids. “The top bid in the tender for this site could range from $500 million to $550 million ($1,392 to $1,532 psf ppr),” says Mak. This year, most of the GLS sites for sale have drawn more than 10 bids each.

The Fourth Avenue site is also in the neighbourhood of the Eng Neo Good Class Bungalow Area and the Raffles Park GCBA. In the vicinity are top schools such as Nanyang Girls’ High School, National Junior College and Hwa Chong Institution.

Just 400m from the Fourth Avenue GLS site is the 104-unit, freehold Royalville, which was put up for collective sale in October at $368 million ($1,509 psf ppr). The 174,176 sq ft, freehold site can be redeveloped into a 323-unit private condominium, assuming an average size of 754 sq ft a unit.

If the Royalville site is successfully sold, following the close of its tender on Nov 10, this means 778 units will be in the pipeline in the vicinity of the Sixth Avenue MRT station.

Source: URA

ZACD Group’s Mak expects the Fourth Avenue site, which is adjacent to the Sixth Avenue MRT station, to draw 10 to 15 bids

Source: ET&Co

Just 400m away from the Fourth Avenue site is the freehold Royalville, which was put up for collective sale in October at $368 million ($1,509 psf ppr)

Cuscaden Road

On the Reserve List is also the 0.57ha Cuscaden Road site, which is adjacent to Camden Medical Centre and within walking distance of the future Orchard Boulevard MRT station on the Thomson East Coast Line. The site has a permissible GFA of 172,482 sq ft, and could yield a residential development of 170 units. “Comparable land sales in this prime location are few and far between,” says ZACD’s Mak.

He expects the site to attract eight to 15 bids and bid prices of $250 million to $270 million ($1,450 to $1,565 psf ppr). “It is quite likely that the Cuscaden Road site could be triggered in the coming months,” says Mak. If the collective sale fever continues to push up land prices, he reckons that could just be the catalyst to trigger the launch of the Cuscaden Road site.

Almost all condominiums in the vicinity of the Cuscaden Road site are freehold, comments Mak. “Tomlinson Heights and Cuscaden Residences, which are comparable developments nearby, have seen average prices of $2,785 to $1,867 psf in recent transactions,” he notes. The 70-unit Tomlinson Heights was completed in 2014, and the 150-unit Cuscaden Residences was completed in 2002.

Chong Kuo Road

Over at Sembawang, the URA has launched a 99-year leasehold site along Chong Kuo Road on the Confirmed List for sale. The tender for the site will close on Jan 30, and its closing is batched with two other residential sites that will be launched for sale in November and December located on Handy Road in Dhoby Ghaut and Sumang Walk in Punggol (an executive condo [EC] site).

ET&Co’s head of research, Lee Nai Jia, says Kandis Residences, a 99-year leasehold condominium project on Jalan Kandis off Sembawang Road, is a likely comparable to the site on Chong Kuo Road. Tuan Sing had paid $51.07 million ($481 psf ppr) for the Jalan Kandis site in April 2016.

In the EC market, the number of unsold units have slipped to just 698 in September — the lowest since October 2014, notes ZACD’s Mak. “At the current rate of sales, the developers’ inventory of launched and unsold EC units would be fully exhausted in about two months if there are no new launches for the rest of 2017.”

This makes the Sumang Walk EC site attractive, notes Mak, as the developer will be able to capitalise on the thinning EC supply by building a new development of 815 units on the site.