The lacklustre collective sale market looks a bit perkier after two developers submitted expressions of interest in the Shunfu Ville site.
The 358-unit project in Upper Thomson was put on sale in September with an asking price of at least $688 million.
The tender exercise closed last week with no formal bids lodged but negotiations are ongoing with the interested parties, said Mr Tan Hong Boon, regional director of capital markets at JLL, the marketing agent.
Experts noted that potential buyers of collective sale sites are especially concerned about the Additional Buyers' Stamp Duty
(ABSD), which developers must pay if they do not complete a residential project and sell all units in five years.
The ABSD is levied at 15 per cent on the purchase price of the site. The five-year clock starts ticking for such sites from the time the Strata Titles Board or High Court gives the green light for the sale.
Developers of such sites would be hampered by various time lags: the roughly three months it could take for legal completion of the sale; the four to six months residents typically get to move out; and another two to three months to demolish the building, said Mr Lee Liat Yeang, real estate partner at Rodyk & Davidson.
The large number of units that the massive 408,927 sq ft Shunfu Ville plot can support - up to 1,500 units, assuming a minimum average unit size of 753 sq ft - would increase the risk of a developer having to pay the ABSD.
Yet the site is not the biggest on the market. That honour goes to the 661,000 sq ft Normanton Park plot, noted Dr Lee Nai Jia, DTZ regional head of research.
"Whether all units can be sold is a bit hard to project given current market conditions... But as some of the Government Land Sales sites are in good locations, developers are likely to prefer those," he said.
"For an en-bloc sale to occur, the site would have to have a wow factor - very accessible to the MRT, near good schools," he added.
The Strata Titles Board approved the collective sale of Thong Sia Building in Orchard Road last Friday - the only major collective sale deal so far this year.