Developers still seem to believe in the draw of executive condominiums (ECs), going by the turnout for a Yio Chu Kang Road site that closed its tender yesterday.
Ten firms placed bids for the 1.84ha plot, which can yield about 520 units. Hoi Hup lodged the top offer of $183.8 million, or $331 per sq ft per plot ratio (psf/pr).
The response was a stark turnaround from the more moderate bidding seen last year, when three EC sites had top bids of $278 psf/pr to $295 psf/pr, noted Mr Ong Teck Hui, JLL national research director.
Hoi Hup's bid was 6.1 per cent above the next highest of $173.2 million or $312 psf/pr lodged by Nanshan Group.
The stronger showing yesterday was probably due to the attractiveness of the site, which is in an established suburban area, Mr Ong added. While it is not near an MRT station, the closest one is just a short drive or bus ride away. It is also close to amenities, including Hougang 1 mall and Hougang Sports Centre.
Its proximity to Rosyth School could also give developers confidence that demand may come from young couples planning to enrol their children, said Mr Desmond Sim, CBRE head of research for Singapore and South-east Asia.
There are also hardly any ECs in Yio Chu Kang, Mr Ong noted.
While it is not near an MRT station, the closest one is just a short drive or bus ride away. It is also close to amenities, including Hougang 1 mall and Hougang Sports Centre.
"The most recent, The Topiary, was launched in late 2012 and was practically sold out by mid-2013, reflecting strong demand for ECs in the Yio Chu Kang area, although market conditions were better then," he said.
There could be strong upgrader demand for the eventual project from residents in the nearby HDB estates of Hougang, Serangoon and Ang Mo Kio as well.
The estimated break-even price for an EC on the site could be $680 to $700 psf, said Mr Nicholas Mak, head of research at ZACD, an investment strategy firm.