This past week saw the state tender closing of a private residential site draw only 6 bids in. The 99 year leasehold site is situated along the West Coast Vale and offers a front view along the waterway of Sungei Pandan. This figure is but 1/3 of 18 bids that was drawn in for neighbouring site Waterfront at Faber, whose tender closed on the 18th of June, 2013. This was just prior to the introduction of the framework for the total debt servicing ratio for Wandervale EC.
The top bid for this most recent tender was made by El Development for a price of $551.15 psf ppr, a figure that is 20% less than what was put forth for an earlier site by World Class Land’s Aspial Corp unit, of $687.42 per square foot, per plot ratio.
Market watchers are saying that this large gap between the outcomes of these two tenders was down to a combination of factors that were site specific and more fragile market conditions in the present.
Wandervale EC Choa Chu Kang
Market analysts have suggested that, on this most recent plot, one side faces a very busy Ayer Rajah Expressway. This means that the pricing will need to be adjusted by the developer of the project to compensate for the noise. On top of this, conditions in the property market are more challenging, with the total debt service ratio and the additional factor of rising interest rates for loans of Choa Chu Kang Wandervale EC.
The wary top bid is also factoring in the progress of sales in projects close by. Going by the June 2015’s monthly sales data from URA, Waterfront at Faber has 210 units, of which 72 are still unsold.
Eugene Lim, the key executive officer for ERA Realty, pointed out that this more conservative interest coming from developers on this latest tender could be a result of the considerable supply of 18,275 private homes, of which are non-landed, had their sales licenses by the end of the 2nd Quarter.
Sim Lian Land Wandervale EC
It did not go unnoticed that this latest tender saw an absence of Chinese developers.
According to another consultant, the recent tenders low rate of turnout may have bee down to a few developers saving for Wandervale EC Choa Chu Kang sites that were more attractive in the upcoming 2nd half of the Government Land Sales Program.
The top bid placed by El Development was 3.2% above the 2nd highest bid of $533.96 per square foot, per plot ratio, made by a joint venture between Oriental Worldwide Investments, Hoi Hup Realty and Sunway Developments. A tie for the lowest bid came from Kheng Leong Company and Singapore Land’s Singland Homes unit for $415.69 per square foot, per plot ratio.
Lim Yew Soon, the managing director for El Development, has given a break even cost estimate a just under $1,000 per square foot, a figure that has factored in a higher cost of construction due to standard Prefab Prefinish Volumetric Construction that is required for this project. It is the hope of the group that they will be able to launch Sim Lian Wandervale EC in a year and is aiming for a $1,100 to $1,200 per square foot average sale price.
The scheme that the group has proposed is made up of two tower blocks of 40 storeys each and with around 700 units. It will not only offer 1 to 4 bedroom flats, but also a few homes that are strata landed for Wandervale EC.