“The site received seven bids, with a top bid of SGD318.9 million or SGD576.2 psf ppr, in line with expectations. The top bidder was a JV between Evia Real Estate and Gamuda who last partnered in GEM Residences. Evia Real Estate is also no stranger to EC development, having developed Heron Bay EC in 2012 and Lake Life in 2013.
Interestingly, the top bid barely edged out the second highest bidder by just SGD899 or 0.0003%, and the tight margin of just 15% between the top and last bidder showed the consensus of pricing among developers.
Together with the Canberra Link EC site tender which closed on Sep 4 and saw nine bids and a top bid of SGD558.2 psf ppr, we believe there continues to be relatively stronger demand for EC land. This compared with the subdued three and five bids for the Jalan Jurong Kechil and Dairy Farm private housing sites which both closed on Sep 4, post measures. Developers appear to think that in light of the latest government curbs, EC units would still enjoy strong demand.
Based on the top bid of SGD576.2 psf ppr, we estimate a breakeven price of SGD900-950 psf ppr and an average selling price of SGD1,100psf.
This site tender was triggered in July with a successful application by an unnamed developer committed to a bid of at least SGD255 million or SGD460.8 psf ppr for the 99-year leasehold site. It was subsequently launched for tender on 10 August.”