ST : 6 bids for Tampines executive condo site

Nov 24, 2010

6 bids for Tampines executive condo site

By Harsha Jethnani

AN EXECUTIVE condominium site in Tampines Avenue 8, launched last month, has chalked up six bids, with offer prices slightly higher than market expectations.

The top bid of $187.6 million or $302 per sq ft per plot ratio (psf ppr) came from a consortium comprising Hoi Hup Realty, Sunway Developments and SC Wong Holdings.

The 20,600 sq m site, put out to tender on Oct 6, is set to yield about 525 units.

Analysts had expected prices for the site with a maximum gross floor area of 57,680 sq m to range from about $220 to $280 psf ppr.

The second top bid was from another consortium, made up of Opal Star and Lum Chang Building Contractors, which offered $172.8 million or $278 psf ppr in the tender, which closed at noon yesterday.

Demand for executive condo sites launched in the second half of the year has been tapering off.

Two sites at Punggol drew five and four bids when tenders closed in June and September. In August, a site at Jurong West saw no bidders.

However, the somewhat stronger response for the Tampines land parcel 'shows that developers are fairly confident about this site', said Mr Li Hiaw Ho, executive director of CBRE Research.

He added that the site is within walking distance of Bedok Reservoir and Temasek Polytechnic. It is also near Tampines Central, Tampines MRT station and the Tampines Retail Park featuring Giant, Ikea and Courts outlets.

Mr Li said the $302 psf ppr offer price translates to a break-even cost of $600 to $620 psf.

Going by the experience at Waterview, a private condo at Bedok Reservoir where 200 units were reported to have been sold at an average of $838 psf last week, 'there will be a market for this new EC project if it is priced at a differential of 15 to 20 per cent lower than Waterview', said Mr Li.

That works out to a selling price of $670 psf to $712 psf.