Dunman Road GLS site with highest bid of $1.284 bil by SingHaiyi
Read more: Triplex penthouse with a 270-degree view of Marina Bay for $111.11 mil
The Pine Grove (Parcel A) auction attracted 5 bids that of the land sold by government (GLS) site for Dunman Road had only two bids. The highest offer of $1.284 billion or $1,350 per plot for a plot (psf ppr) was made by SingHaiyi Group while the second place was won by the consortium of City Developments Ltd (CDL), Hong Leong Group and TID with the highest bid that was $1.067 billion ($1,122 per plot ratio psf).
“Today’s tender’s closing illustrates that developers remain cautious when it comes to purchasing residential sites particularly larger ones such as the lackluster participation in tenders,” says Ong Teck Hui, JLL senior director of research and consulting. “This happens despite small inventory that is not sold and the recent successes of Piccadilly Grand and Liv@MB.”
The highest bid of $1,350 per sq ft per ppr has been 20.3% higher than the lower bid of $1,122 per psf, which suggests the restrained effort to be competitive by the less bidder. “This tender indicates that billion-dollar sites aren’t popular in the present market because they’re risky due to the capital expenditure and the risk of selling over 1,000 units before the five years required to qualify for ABSD [additional buyer’s Stamp Dutyremission]” Lee says. Lee.
The difference in percentage between these two bids is the largest for an residential GLS tender in the past, since the tender was closed for GLS site located at Jalan Jurong Kechil, which ended in September of 2018, according to Nicholas Mak, ERA Realty Network director of research and consulting. The Jalan Jurong-Kechil GLS tender, there was a gap between the highest bid and second-highest offer of 31.3%, he adds.
It is possible that the Dunman Road site could be transformed into a new residential development with around 1,040 units.
The price of $1,350 per the ppr offered by SingHaiyi is approximately 4% over the $1,302 psf per-percentage paid to CDL to acquire the GLS site located at Jalan Tembusu, also in District 15 in January of this year. This Jalan Tembusu site, which could yield around 64 units, had attracted eight bids as of the closing of the auction.
Two significant developments are that are in the pipeline to opening in District 15 including that of the Jalan Tembusu GLS site as well as the freehold Thiam Siew Avenue site purchased in a single transaction through a joint venture of Hoi Hup Realty and Sunway Developments in November. The site could be converted into a brand new 820-unit condominium development.
As per Tricia Song, CBRE head of research for Southeast Asia, the low quantity of bids on this site despite its appealing locational characteristics reflect “its massive size and competitiveness” from the new developments in Jalan Tembusu and Thiam Siew Avenue.
Song estimates that the proposed residential development on Dunman Road could be launched at between $2,200 and $2,300 per.