Executive condo demand could trigger Tampines Avenue 10 sale

It was put in the government's Reserve List along with Sims Drive.

The government has placed two residential sites, Tampines Avenue 10 and Sims Drive, in the Reserve List for its Government Land Sales (GLS) programme. Analysts expect their sales to be triggered soon due to rising demand for their respective property types.

According to Tricia Song, head of research for Singapore, Colliers International, the sale of the executive condominium (EC) site in Tampines Avenue 10 could be the first to be triggered due to diminishing unsold EC stock in the market and the continuing appeal of ECs to home buyers.

"The robust demand for ECs - a hybrid between public and private housing – was also driven by their relatively affordable price points for the 'sandwiched' class. Should it be put up for sale, we believe there will be stiff competition for it and could potentially fetch $360m (or $480 psf ppr)," Song said.

This would be lower than the record psf price of $583 psf ppr for the Sumang Walk EC recently, but will still be the second highest for an EC site.

Tay Huey Ying, JLL head of research and consultancy for Singapore, concurred with Song that demand for ECs is currently high in Singapore. "Developers' hunger for EC sites is evident in the 17 bids and record-breaking top bid attracted by the Sumang Walk EC GLS site when tender closed in February 2018," she said.

"Underpinned by a hiatus of EC GLS tenders for one-and-a-half years prior to the launch of the Sumang Walk site, the absence of EC site in the East of Singapore, since the Sea Horizon site was sold in November 2012, rising private home prices and record low unsold EC developer inventory, the Tampines Ave 10 EC land parcel holds high potential to be triggered for sale," she added.

Meanwhile, the Sims Drive site should attract more bids – and likely more bullish ones - than the four bids garnered by the adjacent site where Sims Urban Oasis currently sits, Song noted. "Sims Urban Oasis had a slow start but had finished strongly with 98% of its 1,024 units sold as of April 2018, with selling prices rising from a low of about $1,300 psf to the current $1,500 psf."

Song projected that the site could see a top bid of $575m ($1,100 psf ppr) should it be triggered for sale.

Tay brought up another sale in the Sims Drive vicinity, the Mattar Road GLS site, which was keenly contested by ten participants and attracted a higher-than-expected top bid of $1,109 psf ppr when tender closed in April 2018.

The key attractions for the Sims Drive Reserve List site are that it is in a city fringe location and it is within walking distance (450 metres) to the nearest Aljunied MRT station.