Boon Keng Development submitted the highest bid of $65.2 million for the acquisition of an industrial site at Woodlands Avenue 12 through a government tender which closed yesterday.
The bid price, which translates to $75 psf ppr, is 29 percent higher than the second highest bid of $50.6 million, or $58 psf ppr, offered by TGFB Pte Ltd and more than twice the application bid which triggered the site for tender. The site received a total of six bids from developers including Wee Hur Holdings and Soilbuild Group.
The 60-year leasehold site was launched after a developer committed to submit a bid of at least $25.0 million, or $29 psf ppr, for the land parcel last month. The site has a maximum gross floor area of 868,628 sq ft.
Mr. Li Hiaw Ho, executive director of CBRE Research, said: “The strong GDP growth of 13.1 percent year-on-year in Q1 2010, driven by a 30 percent year-on-year surge in the manufacturing, has resulted in demand for new industrial space as evidenced by the six bids received by the Urban Redevelopment Authority.”
The top bid is also more than twice the highest bid for an industrial site in Woodlands in the last two years.
Wee Hur acquired a 60-year leasehold industrial site at the junction of Woodlands Industrial Park E5/Avenue 4 for $22.9 million, or $34 psf ppr, in July 2009. Soilbuild Group also acquired a 60-year leasehold site along Woodlands Industrial Park E5 for $13.6 million, or $30 psf ppr, in July 2008.
Mr. Li projects the breakeven cost for this development to be around $240 psf to $260 psf. CBRE’s data shows that during the first four months of the year, strata-titled units in Admiralty Industrial Park, situated along Woodlands Industrial Park E1, went for between $163 psf and $249 psf.