A plum site in Lorong Lew Lian has attracted a bumper crop of l1 bids as developers move to replenish their land banks in the light of fewer state plots going on the market.
City Developments (CDL) and joint venture partners Hong Leong Holdings and TID submitted the top bid of $321 million, or about $710 per sq ft per plot ratio (psf ppr) for the site tender, which closed on Thursday (Nov 05).
That was 2.6 per cent above the next highest bid of $312.88 million or $692 psf ppr, from a consortium of Singapore Land unit Singland Homes and UOL Venture Investments. UOL Group is the developer of the nearby Botanique at Bartley.
The 1.4 ha site was on the reserve list of the Government Land Sales programme for this half of the year.
It was triggered for release and launched for sale in October - the first time in about 21 months that a reserve list site was triggered.
If awarded the site, CDL's joint venture will explore building a 12- to 13-storey condominium with around 500 units, a spokesman said.
It is familiar with the area - having jointly developed the nearby 702-unit Bartley Residences, which is fully sold, and the 868-unit Bartley Ridge, which has been 99 per cent taken up, she added.
The crowded field of developers is in line with recent tenders, noted SLP International executive director Nicholas Mak. The other six condo land tenders that closed this year received an average of 11 bids.
"Some developers may wish to replenish their land banks given the more subdued market, and the absolute price quantum of this land parcel might be within the range of quite a few large developers and consortiums," he added.
Bidders were likely attracted by the site's close proximity to the Serangoon bus interchange and MRT station - an interchange for the North East and Circle lines - and the nex mall.
There were also just 435 unsold units in nearby condo blocks as at Sept 30 and no other major projects in the area are slated for launch, Mr Mak added.
The healthy take-up rate at the recently launched High Park Residences and Botanique at Bartley may also have encouraged developers, said R'ST Research director Ong Kah Seng.
Mr Desmond Sim, CBRE research head for Singapore and South-east Asia, said developers would also have the benefit of time to bank on any market recovery.
"At the same time, they can benefit from the strong development pipeline along the North East and Circle lines, including the Bidadari housing estate," he added.
Indeed, the top bid reflects confidence that prices during the launch will not be far from current levels, with the average selling price likely to be about $1,300 psf, said JLL national research director Ong Teck Hui.
"Compared with the Botanique at Bartley site which fetched $648 psf ppr in January last year (and drew seven bids), the subject site is better configured and in a better location, which accounts for the higher bid and keener competition," he added.