The government has kick-started land sales for the year by putting up a residential site at the junction of Choa Chu Kang Road and Woodlands Road for tender – the first on the H1 2010 confirmed list to be launched for sale.
The 99-year-leasehold plot comes with the existing Ten Mile Junction development. Some market watchers are expecting higher bids ranging from $135-$150 million for the site this time, well above those received in 2008 when the government tried to sell it.
‘Market sentiments have picked up and there is actually quite a dearth of mass-market sites,’ says Colliers International research and advisory director Tay Huey Ying. ‘We should be able to see more respectable bids being put in.’
According to the Urban Redevelopment Authority yesterday, the site spans 1.56 ha and the three-storey Ten Mile Junction sits on it. Commercial space with a gross floor area (GFA) of around 121,191 sq ft takes up the first two levels, while an LRT station occupies the third level.
The winning developer would be able to build a residential development with a maximum permissible GFA of 254,394 sq ft on top of Ten Mile Junction. The latter already has loading provision for the residential project, which could have around 200 apartments.
On the whole, the land sale involves only the existing commercial component and the future residential development. Supermarket chain Sheng Siong is the master tenant of the commercial space.
Property consultants cite the land parcel’s proximity to Bukit Panjang Plaza, the upcoming Bukit Panjang MRT Station and other amenities as attractive features.
CB Richard Ellis Research executive director Li Hiaw Ho expects bids for the site to range from $135-$150 million, comprising $60-$65 million for the residential component and $75-$85 million for the commercial podium. Developers could sell the homes at around $650-$700 per square foot (psf).
‘The site is likely to attract HDB upgraders and people who work in Bukit Panjang, Choa Chu Kang and Woodlands,’ he says. At nearby Maysprings, apartments recently went for $509-$672 psf.
Ngee Ann Polytechnic real estate lecturer Nicholas Mak believes that the site will attract five to eight bids, with the highest coming in at $140-$147 million.
He also draws up an interesting scenario – that Sheng Siong could team up with a developer to bid for the site. As part-owner, the supermarket chain would be able to ’secure its interest’ and keep rents down, he suggests.
But developing this site is not without challenges. As DTZ South-east Asia research head Chua Chor Hoon highlights: ‘It is more challenging to build over the existing podium than over a vacant piece of land.’
The tender will close on Feb 23. Estimated bids for this tender far exceed those which the government received some years ago when it tried to sell the site. When tender closed in April 2008, just two developers submitted bids and the highest one was $61 million – too low to be accepted.
The government will be launching more sites on the confirmed list soon. HDB will invite interested parties to tender for two executive condominium sites at Buangkok Drive and Yishun Ave 11 on Jan 15.
Source: Business Times, 6 Jan 2010
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