Two condo sites likely to draw keen interest

Plots in Alexandra, Sembawang seen drawing bids as few development sites being offered lately

Keen interest is expected for the first two private residential sites released under the Government Land Sales (GLS) programme for this half of the year.

A 0.84ha condo plot in Alexandra View next to Redhill MRT station is on the confirmed list and can yield 400 homes, while a 0.73ha condo site in Jalan Kandis in Sembawang is on the reserve list and can accommodate 115 homes.

Development sites have been in short supply in recent GLS programmes, so property firms will be quick to run the rule over these offerings.

"Developers are on the lookout for sites, given the current pull-back on residential sites for sale on the GLS," said Mr Desmond Sim, CBRE research head for Singapore and South-east Asia.

"Many developers do not have much land in Singapore and need continuity in their businesses."

The number of new residential units made available via the GLS programme for this half of the year across confirmed and reserved sites is the lowest since the first half of 2007.

The small sizes of the plots released yesterday present an affordable quantum for developers, Mr Sim added, while the fewer units they can yield means a potential project will be easier to sell out.

The Alexandra View site is attractive for its proximity to the MRT station and the provision of commercial use on the first storey, said Mr Ong Teck Hui, JLL national research director.

But bidders will be cautious about the large number of unsold units in the area, he noted, forecasting the top bid to come in at $850 to $1,050 per sq ft per plot ratio (psf ppr), or $376.5 million to $465.1 million.

There were 179 unsold units in Alex Residences and 385 in The Crest as at the end of August, while the upcoming Principal Garden has 663 units.

Highline Residences, which is a bit further, near Tiong Bahru MRT station, has 351 unsold units.

Still, a successful bidder would have the luxury of time to wait for the market to turn as any project developed on the site will be completed only in four to five years, said CBRE's Mr Sim.

The Jalan Kandis site is in a landed residential area with few condos, noted Mr Nicholas Mak, SLP International executive director.

The small plot could attract small- and medium-sized developers and, if triggered for sale, could go for $400 to $452 psf ppr, or $42.5 million to $48 million.

However, a major disadvantage is its distance from the Sembawang and upcoming Canberra MRT stations, and other amenities, he added.

"In view of the slow primary market sales, it is unlikely for this site to be triggered for tender in the next 12 months."

A version of this article appeared in the print edition of The Straits Times on October 01, 2015, with the headline 'Two condo sites likely to draw keen interest'. Print Edition | Subscribe