The tender for a land parcel at West Coast Link / West Coast Crescent has received a total of 12 bids, with Boo Han Holdings offering the highest bid of S$175.8 million (approximately S$461 psf ppr).
Boo Han’s bid would, based on current sales prices, give the company a profit margin of about 27 percent, said Alan Cheong, Associate Director for Research & Consultancy at Savills Singapore.
“This means that the developer only needs to sell about 73 percent of the Net Saleable Area to breakeven, assuming current market prices of S$1,150 psf hold for the area.”
Li Hiaw Ho, Executive Director at CB Richard Ellis (CBRE), noted that the top bid will translate to a breakeven cost of between S$800 psf and S$820 psf.
Meanwhile, the second highest bid for the site was offered by Centurion RE Ltd at S$173.9 million, followed by a joint bid between Sunmaster Holdings and Intrepid Investments at S$171.8 million.
Other bidders include MCL Land, EL Development, Allgreen Properties and CEL Development, which emerged the lowest bidder, at S$127.09 million.
“The interesting point about this tender is that a total of 12 developers participated, upsetting the recent trend which saw only three or four parties taking part in the past few Government Land Sales (GLS) programme,” said Cheong.
“Another insight seems to be a divergence in opinions amongst developers with two-thirds of them submitting more conservative bids by building in wider safety margins.”
Located in the western part of Singapore, the land parcel has a total area of 12,662.7 sq m, with a maximum permissible gross floor area (GFA) of 35,456 sq m and can yield up to 360 housing units.
The site is also just a five- to 10-minute drive from the Southern Waterfront, where dining, shopping and entertainment amenities abound.
Li noted that the site is also adjacent to The Vision condominium, which is currently under construction.
“The West Coast Park and Clementi Woods provide a lot of greenery and open space for the residents in this neighbourhood. This location is popular with the Japanese community because of the presence of Waseda Shibuya High School and The Japanese Supplementary School,” he said.
The URA said it will evaluate the tender result and a decision on the award will be publicised at a later date.
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