SINGAPORE: For the first time in two decades, there were no bids placed for a plot of land at Upper Thomson on Wednesday (June 19).
The site had been designated for as many as 640 residential units including 100 long-stay serviced apartments. The tender for the residential Government Land Sale (GLS) site closed with no developers bidding for it, despite speculation from market watchers that there would be up to three bids.
Business Times quotes consultants as saying they had expected the site to have received offers between S$750 to S$1,020 per square foot per plot ratio.
The 262,875 sq ft site is a a 99-year leasehold, with around 21,528 sq ft of commercial space at the first storey and a minimum of 1,000 sq m for a childcare centre.
The absence of bids for the site follows the trend of decreasing private home sales this year. An already low rate of 301 units sold in April was followed by an even smaller volume the following month, with only 221 units sold.
In April, another site at Upper Thomson Road had only one bid, jointly submitted by GuocoLand and Hong Leong Holdings. The S$780 million or S$905 psf ppr bid is only for residential purposes and can accommodate 940 units.
Industry experts appear unsurprised, however, at the lack of bids for the latest land sale despite its nearness to the Springleaf MRT station as developers growing wary to take risks because of higher interest rates, cooling measures and increasing costs.
The area is far from major commercial hubs and the success of long-stay serviced apartments there has yet to be proven.
“The Government is probably aware of this and hence reserved only 100 units for long-stay serviced apartments. Even (with) a small number of SA2 units, developers may have felt that the risks are tilted towards the high side and have chosen to sit out this tender,” Edgeprop quotes Mark Yip, CEO of Huttons Asia, as saying.
On the same day, another plot at River Valley Green that can accommodate 380 private homes, received only two bids. The higher bid, S$1,325 per sq ft per plot ratio (S$464 million), came from Wing Tai Holdings unit Winchamp Investment, is 12.5 per cent lower than a site nearby at Irwell Bank Road, had fetched a price of $1,515 psf ppr in January 2020, a time when market conditions were better, The Straits Times noted. /TISG
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