URA awards Zion Road site to CDL-Mitsui Fudosan JV, and Upper Thomson Road site to GuocoLand-Hong Leong JV
The JV affiliates have previously indicated that they plan to develop the spot into a mixed-use development making up 2 housing blocks, one that is 69 storeys and the some other 64 storeys, with about 740 residential units offer for sale in total amount. The scheduled project will even make up a retail podium, and a 35-storey block with concerning 290 rental apartment units.
According to a GuocoLand speaker: “The Upper Thomson Road site is located in a premium landed housing area, similar to the Lentor Hills estate which we have developed as a new premium personal residence estate with our projects such as Lentor Modern and Lentor Mansion. We are delighted to have the chance to boost another new area at Springleaf via our placemaking capacities. The future advancement, which is offered by the Springleaf MRT station on the Thomson-East Coast Line, will have around 940 units.”
Wong Siew Ying, head of research and information at PropNex Real estate, mentions that although the land costs were below market assumptions URA likely looked into various other aspects in assessing the bids. “For example, the Upper Thomson Roadway plot remaining in a reasonably untried brand-new real estate precinct, and the Zion Roadway plot being the initial development to make up the long-stay serviced flats,” she says.
Mark Yip, Chief Executive Officer of Huttons Asia, says that the eye-watering rate for the location is a “huge commitment in the face of high interest rates. Considering these dangers, the quote of $1,202 psf ppr is fair”.
Reserve Residences Far East Organization & Sino Group
This was echoed by Tricia Song, head of study, Singapore and Southeast Asia, CBRE. She notices that the offer for the Zion Road spot is a “considerable” 30% lower than the comparable land parcel across the road, which has actually been developed into the 455-unit Riviere. “The approval of the lower-than-expected proposal price despite its being the single quote, is a recognition that market conditions have changed over the previous 5-6 years given that the bordering location was awarded, given factors such as increased ABSD, greater building expenses, funding costs, in addition to risk premium for the (long-stay serviced apartments) part which is a brand-new possession class,” says Song.
” At a land price of S$ 1,202 psf ppr, the breakeven cost could potentially range between S$ 2,400 psf and S$ 2,600 psf basing on technical, material and layout ideas, with kick off costs beginning with S$ 2,700 psf,” claims Alice Tan, head of consultancy at Knight Frank Singapore. She includes that the brand-new development could go for about S$ 3,000 psf and this price would certainly not only be tasty, yet attractive for Singaporean buyers and long-term locals, whether for job or financial investment.
Tan predicts that the brand-new development might see a potential launch opening cost of merely under S$ 2,000 psf. “As the Upper Thomson Roadway Parcel B area would be the first in a relatively undeveloped location without high-rise houses, there is some initial mover benefits in a breathtaking precinct,” she says.
The CDL-Mitsui Fudosan JV was the only one to send a quote for the Zion Road location when the tender closed on April 4. Likewise, the GuocoLand-Hong Leong JV even sent the sole proposal for the Upper Thomson Roadway GLS spot when that tender closed on April 4. Eugene Lim, key executive officer, period Singapore, commented that both GLS spots are reasonably ‘untried’. “The state might have taken into consideration the tender costs submitted for these locations to be sensible, regarding the risks that these programmers are prepared to tackle,” he states.
At the same time, the GuocoLand-Hong Leong JV sent a proposal of $779.6 million for the 344,700 sq ft site around Upper Thomson Road. The price translates to $905 psf ppr.
The $905 psf ppr bid put in by GuocoLand-Hong Leong is “reasonable” as it is a much bigger location compared to the Zion Road plot, states Yip, including: “For this reason the quantum is larger, and with a bigger quantum the possibilities are correspondingly higher as well”.
CDL and Mitsui Fudosan sent a $1.107 billion attempt for the 164,439 sq ft spot, which converts to $1,202 psf per plot ratio (ppr). The place has a story ratio of 5.6 and is zoned residence with commercial on the first level. The new project might produce approximately 1,170 new home units. This is likewise the very first location released by the government that included devices under the new long-term serviced condominium arrangement.
URA has allocated the tender for two recently closed government land sale (GLS) locations. A non commercial location at Zion Road was granted to a mutual project (JV) amongst City Developments Ltd (CDL) and Mitsui Fudosan, while a several GLS spot at Upper Thomson Roadway was awarded to a JV within GuocoLand and Hong Leong Holdings.
