Surprise low turnout: Only one bid each for Zion and Upper Thomson sites

SINGAPORE: Limited interest was evident as the tender for two prime sites at Zion Road (Parcel A) and Upper Thomson Road (Parcel B) closed with just one bid each, fetching $1.11 billion and $779.56 million, respectively.

The sole bidder for the Zion Road (Parcel A) site was a consortium comprising CDL-MFA Vega Property and CDL-MFA Altair Property, which submitted a bid of $1.11 billion.

This bid was for the 15,277-square-meter plot, which can accommodate 1,170 private homes, 435 long-stay serviced apartments, and 2,400 square meters of commercial space.

On the other hand, GuocoLand (Singapore) and Intrepid Investments emerged as the only bidder for the Upper Thomson Road (Parcel B) site, with a bid of $779.56 million. This site has the potential to yield 640 homes, including 100 long-stay serviced apartment units.

The Urban Redevelopment Authority (URA) initiated the public tender for these sites on Dec 4, 2023, and concluded the exercises on April 4, 2024.

Analysts’ projections initially anticipated robust interest in the Zion Road plot, given its proximity to Orchard Road and the bustling F&B scene along the Singapore River.

PropNex Realty anticipated two to three offers, with bids ranging from $1.47 billion to $1.66 billion.

However, developers bidding for the two Upper Thomson Road sites exhibited caution, which was attributed to the considerable supply of new homes in the Lentor Hills area.

PropNex forecasted four to five bids for Parcel A, with the winning offer potentially reaching $723 million, while Parcel B was expected to garner two to three bids, possibly fetching up to $948 million.

However, Huttons Asia advised on the risks associated with Parcel A, citing it as an “untested site for serviced apartments,” and projected that winning bids for both sites might not exceed $1,000 per square foot per plot ratio.

Justin Quek, deputy CEO of OrangeTee & Tie, echoed the sentiment of subdued interest, attributing it to factors such as elevated interest rates, macroeconomic uncertainty, geopolitical developments, and high construction costs.

URA is set to announce the site tender award after a thorough review of the bids amidst the backdrop of subdued enthusiasm in the property development landscape.