ST : Six bids for Pasir Ris executive condo site

Oct 22, 2010
Six bids for Pasir Ris executive condo site
By Harsha Jethnani

AN EXECUTIVE condominium (EC) site in Pasir Ris has drawn healthy interest, with six bids put in by developers by the time the tender closed yesterday.

The 15,142 sq m site, at the junction of Pasir Ris Drive 1 and Elias Road, is expected to yield about 320 housing units.

The top bidder was ChoiceHomes Investment and CEL Developments at $89.88 million or $263 per sq ft (psf).

Buying interest was strong when the first new EC to go on sale in five years, Esparina Residences near Buangkok MRT station, was launched earlier this month.

ECs are the grandest form of public housing and include some condo facilities. Like other HDB flats, they are subject to a minimum five-year occupation period. Then they can be sold only to Singaporeans and permanent residents. They become private property after 10 years, and can then be sold to foreigners.

The second highest bid for the Pasir Ris site, just a notch lower, was EL Development's $89.33 million or $261 psf.

The two lowest were below $80 million. Ecco Development's $61 million or $178 psf offer was the lowest.

Hoi Hup Realty, Sunway Developments and S.C. Wong Holdings jointly bid for the land at $78.87 million or $231 psf.

The bids show developers are fairly confident about the site, said executive director of CBRE Research Joseph Tan.

He added that the site is about 15 minutes' walk from White Sands mall and Pasir Ris MRT station and bus interchange.

Knight Frank senior manager of consultancy and research Png Poh Soon told The Straits Times that demand for ECs was still good, 'in particular for this site', given the favourable reception of nearby private condo NV Residences.

Mr Tan added: 'Given that NV Residences - a private condominium - has sold 400 units at the median price of $869 psf since September, there will be a market for this new EC project if it is priced at a differential of 20 to 25 per cent lower.' He expects the break-even cost for development to be $560 psf to $600 psf.

Consultants also say the bidding for the Pasir Ris site reflects growing caution in the property market.

Head of research at Jones Lang LaSalle in Singapore, Dr Chua Yang Liang, said developers have become more realistic given moderating market sentiment.

'When the market is bullish, the variation between the top and second bidders can be quite large,' said Dr Chua.

The relatively restrained bids may in part be because the site was released on Sept 8, soon after the Government's cooling measures, senior manager for Asia-Pacific research at Cushman & Wakefield Ong Kah Seng told The Straits Times.

'Home buyers are on the sidelines and developers are increasingly cautious in this period, which is less than two months from the announced measures,' he said.

He added that in the first half of this year, land prices for ECs reached record highs to average more than $300 psf.

The HDB said it will announce the successful bidder within two weeks.