'Developers still land-hungry but more cautious': PropNex

The Jalan Tembusu site hit a new record land rate of $1,302 psf ppr.

Public land tenders that closed in 2022 saw interest from developers, PropNex commented. 

This comes after the introduction of cooling measures set last 16 December.

Jalan Tembusu, a site located in District 15 in the Rest of Central Region, attracted eight bids. A new record land rate for a residential governmental land sale was also set at $1,302 per square foot per plot ratio. CDL Triton Pte. Ltd. was the tenderer behind this.

“The top bid is about 8% higher than the second-highest bid. However, we note that the difference in bid prices is massive with the top bid being 67% higher than the eighth bid at $460m or $780 per square foot per plot ratio (psf ppr), probably indicating that some developers have moderated the bids to reflect the potential risks posed by the new cooling measures. Meanwhile, we still see some optimism from the top four bids, seeing that the land rates are above the record price of $1,129 psf ppr,” said Wong Siew Ying, Head of Research and Content, PropNex Realty.

Over 640 units are set to be generated from the bidding. 

Before this, the previous record was set at $1,129 psf ppr for the site at Northumberland Road.

Meanwhile, the second public land tender, Lentor Hills, saw less participation with only four developers. The site was awarded to a consortium between Intrepid Investments Pte. Ltd., GuocoLand (Singapore) Pte. Ltd. and TID Residential Pte. Ltd with a psf ppr of $1,060.01. 

“An air of caution can be observed in that three out of four bids for the Lentor Hill Road (Parcel A) fell below the land rate of $1,000 psf ppr. The top bid of $586.6m, reflecting a land rate of $1,060 psf ppr, was considerably lower by 5.2% compared to the Ang Mo Kio GLS site which was awarded at a land rate of $1,118 psf ppr in June 2021. The top bid was also significantly below the record high land rate - for a GLS residential site in the Outside Central Region—set by the nearby Lentor Central site at $1,204 psf ppr,” said Ying.

"Both top bids are within PropNex’s expectations and the tender results today reaffirm that developers are still land-hungry but are perhaps more cautious, given the recent hike in additional buyer’s stamp duty rates."

PropNex projects an average selling price range of $2,100 to $2,300 psf, and $1,750 to $1,850 psf, for both Jalan Tembusu and Lentor Hills.