The gaps between the top bids for a Fernvale Road site were likely the closest for any Government Land Sales (GLS) tender, thanks to fierce competition by 14 developers for the land.
The battle for the 99-year leasehold plot was so intense that bids easily exceeded market expectations, but it is the closeness of the offers that caught analysts' eyes.
A joint venture of Sing Development and Wee Hur Development lodged the top offer of $287.1 million - just 0.005 per cent higher than the $287.09 million from China Contruction (South Pacific) Development.
Allgreen Properties was next at $286.9 million, only 0.07 per cent lower than the top bid.
The top bid works out at $517.03 per square foot per plot ratio (psf pr), the second bid came to $517 psf pr while the third came to $516.7 psf pr.
Mr Nicholas Mak, executive director of SLP International Property Consultants, said this could be the closest price gap in the history of GLS tenders. He attributed it to developers making bullish bids in light of the fierce competition for the land.
Experts had tipped that the site would attract a top bid of $272 million, but the top four bids easily exceeded that estimate.
The 17,196.4 sq m plot, which is near Thanggam LRT station and amenities like Sengkang Riverside Park and The Seletar Mall, could yield about 605 private apartments.
Mr Desmond Sim, head of research for Singapore and South-east Asia at CBRE, noted the implications of the closely priced bids.
"This is an indication that these bidders share similar views on pricing of the projects as well as construction costs control," he added.
Mr Sim said that controlling costs would be a major factor, particularly for the top two bidders as they are developers with a construction arm.
He also said that he expects more residential sites to be released in the next GLS programme, to prevent bids from escalating.
The optimism of developers was also bolstered by the success of the nearby High Park Residences, which has sold 98 per cent of its units based on last month's sales data.
"The higher bid for the site indicates that the units may be sold at a slightly higher price than High Park Residences," said Mr Ong Teck Hui, JLL national director.
He added that the units would probably find demand from buyers, "given the rapid take-up at High Park Residences and against the possible backdrop of an improved market".
