The government has just launched two prime government land sale (GLS) sites from the Confirmed List of the 1H2024 GLS programme, along with another site available under the Reserve List. The Confirmed List features sites at Dairy Farm Walk and Tengah Garden Avenue, while the Reserve List includes a site at Bayshore Road.
Despite the bustling GLS market, Lee Sze Teck, senior director of data and analytics at Huttons Asia, advises caution. "With the government increasing land supply and developers grappling with high construction costs, interest rates, and the harmonization of Gross Floor Area, upcoming bids might be more subdued," he notes.
Marcus Chu, CEO of ERA Singapore, concurs, anticipating tepid bids for most sites except for the EC site at Jalan Lorong Besar and the residential site at Margaret Drive, which are expected to attract fierce competition.
The Dairy Farm Walk site spans 235,448 sq ft with a maximum gross floor area (GFA) of 494,443.5 sq ft. It's designed with a low-rise zone of up to six storeys and a medium-rise zone with buildings up to 85 meters tall, potentially yielding around 540 units. Lee highlights its unique advantage: "This parcel, with a plot ratio of 2.1, offers unblocked views of the Chestnut Avenue GCBA from higher floors."
This site is the third GLS release in the area, following successful tenders in 2018 and 2022. United Engineers secured the first mixed-use residential and commercial site on Dairy Farm Road for $368.8 million. It has now been developed into the fully sold 460-unit Dairy Farm Residences. The second site, awarded to Sim Lian Group for $347 million, is being developed into The Botany at Dairy Farm, which has seen robust sales since its launch.
Chu expects Dairy Farm Walk to attract up to three bidders, with top bids ranging between $800 psf ppr and $850 psf ppr.
The second site on offer is a 273,906.5 sq ft plot at Tengah Garden Avenue, zoned for residential use with commercial spaces on the first storey. It boasts a maximum GFA of 821,720 sq ft, potentially yielding 860 units. Strategically located next to the upcoming Hong Kah MRT Station on the Jurong Region Line, this site promises unparalleled connectivity and convenience.
"This site, with its proximity to the future MRT station, is particularly appealing to homeowners and investors," Chu remarks. It follows the success of the estate's first Executive Condominium (EC), Copen Grand, developed by City Developments (CDL) and MCL Land, which sold out completely in 2022.
Despite the site's allure, developers might hesitate due to the substantial upfront capital required and higher development risks. Chu advises, "Developers need to balance demand drivers and the influx of new developments against the advantage of being first movers."
The Bayshore Road site, listed under the Reserve List, spans 112,914 sq ft with a maximum GFA of 474,247 sq ft, potentially yielding 515 units. This site will be considered for tender only upon receiving an acceptable minimum price application from a developer.
Adjacent to the soon-to-open Bayshore MRT Station on the Thomson-East Coast Line, the site is strategically placed near existing condominiums, The Bayshore and Costa Del Sol. If awarded, this would mark the first private residential development in the emerging Bayshore housing estate, slated to introduce 10,000 new homes, with 70% designated for public housing.