CapitaLand & UOL place top bid of S$805.39m on Holland Drive

The top bid is S$1,285 per square foot, a price below the market expectation, and reflects developers’ continued risk-aversion when it comes to large prime residential sites.

Three bids were received at a Tuesday (May 14) state tender for a 99-year leasehold site near the Holland Village MRT in Singapore. They were however below the market expectations, as developers are still cautious of large prime sites.

The highest bidder, a consortium led UOL Group and CapitaLand Development was S$805,39 million or approximately S$1,285 a square foot per plot rate (psf/ppr).

The top bid is less than the S$1,350 to S$1,500 per square foot per person that The Business Times polled analysts on Monday for the highest bid. The site can produce about 680 homes. They predicted that one to five bids would be made for the site.

Hong Realty and Intrepid Investments, a joint venture between Hong Leong Holdings and Intrepid, jointly bid S$765,26 million, or S$1,221 per square foot, per year. The difference in the two top bids was 5 percent, which indicates that developers valued this site at this market value. This may be an excellent reason to award the site.

Japura Development was the lowest bidder, with a S$632,000,000 or approximately S$1,008 psf ppr. It was linked to CK Asset which was founded by Hong Kong tycoon Li Kashing. The Singapore Urban Redevelopment Authority conducted the tender.

The top bid of S$1,285 per square foot per person is approximately 32 percent below the S$1,888 per square foot ppr that was achieved in 2018 for an adjacent commercial and residential property. The site is being developed by a consortium led Far East Organization into One Holland Village, a residential, serviced apartments, retail, and office project.

Developers are submitting less aggressive bids than six years ago, even though the site on Holland Drive is a pure residential area.

The large number of housing units for private use that could be created on the Holland Drive property may have also dampened bids.

One Holland Village Residences with its 296 units – far fewer than 680 estimated units on the Holland Drive plot – took four years to sell. Developers are therefore likely to be cautious when it comes the site on Holland Drive which is a little further from the Holland Village station.

The larger site, with its 680 housing units, can help developers to achieve economies of scale and lower development risks.

She added that the prime location of this property would have attracted more foreign investors and buyers if it weren’t for the increased rates of Additional Buyers Stamp Duty (ABSD), which are applicable to such buyer profiles, under the April 20,23 cooling measures.

The consortium that won the most recent tender has a stake of 35 percent each in CapitaLand Development, UOL and Singapore Land and 10 percent in Kheng Leong.

The joint venture is the second between CapitaLand, UOL and the state after the Tampines Avenue 11 mixed use state land site that the two clinched in the past year.

If awarded the tender, the consortium plans to build two 40-storey condo towers on the site. The project will accommodate 680 units. The consortium is confident that this site will attract discerning homebuyers due to its location next to Holland Village. This iconic lifestyle destination is very popular among both locals and expatriates.

Developers sold all 296 units of the One Holland Village Residences in August 2023 at an average price S$2,804 per square foot. The developer sold the last 63 units in 2023, at an average of S$2,943 per square foot.

The average price of the future condo development on the Holland Drive plot could start at $2,800 per square foot.

The break-even cost is estimated to be between S$2,500 and S$2,700 per square foot, depending on the design, materials and technical considerations. Prices for the launch are expected to begin at S$2,800 per square foot, with an average price of approximately S$2,900.

The Holland Drive plot is the last private residential land in the popular Holland Village area. A Build-To Order HDB project will be launched in June 2024 on the adjacent parcel. The site is located next to One Holland Village, a mixed-use development. It’s also a short distance from Holland Village MRT.

The Holland Drive site can be developed up to a maximum of 626.717 square feet. It measures 133.343 sq ft and has frontages along Holland Drive, NorthBuona Vista Road, and Holland Road.

The site is also near established schools such as Nanyang Primary, Henry Park Primary and Fairfield Methodist (Primary). It is near schools like Nanyang Primary School, Henry Park Primary School and Fairfield Methodist Primary.

Holland Village will provide the future project with many amenities, including retail and food and beverage options.

The bids on the Holland Drive site were again relatively conservative, despite its attractive location.

Read more up on freehold condo launch in District 10 : Watten House

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