Marina Gardens Crescent site bid is too low; plot not awarded to URA

In a GLS (Government Land Sales) tender that has attracted a lot of attention, the bidder for the 99-year leasehold parcel in Marina Gardens Crescent failed to win the plot because the price was too low.

Urban Redevelopment Authority – URA – said on February 8 that GuocoLand Singapore, Intrepid Investments & TID Residence’s sole bid was too low.

A tender for a white site in Marina South that was designated for both residential and commercial development only received one bid. It was S$770.5 Million or S$984 Per Square Foot per Plot Ratio (psf/ppr). This tender ended on January 18.

The URA’s final decision, made after an unusually long wait for an official bid result, surprised no one on the market.

In the past year, GLS land sites further from Singapore’s city centre, like Clementi & ToaPayoh, have sold at higher prices.

The Business Times published a report three weeks after the close of this tender, stating that the rate for land was much lower than anticipated and that there were no expectations that this tender would be granted. The bid was 30 percent lower than the S$1,402.00 psf/ppr Kingsford Group received for a nearby plot in Marina Gardens Lane during a closed state tender in June.

The GuocoLand Group and Hong Leong Group-related entities’ offer for the downtown plot was also lower that the top bidder on a site located in an urban fringe area in the west. Qingjian Realty/Forsea Joint Venture offered S$1,191 PSF ppr on a Media Circle parcel which was also tendered Jan 18 by a Qingjian Realty/Forsea joint-venture. URA has given the site based on that bid. The amount was approximately S$395.3M.

The measured offer for the Marina Gardens Crescent Site reflects the cautious approach towards large, complex sites requiring considerable land and building costs. Particularly in newly developed and undeveloped districts such as the Marina South precinct.”

GuocoLand Group Intrepid Investments and Guoco Group bid together for the Kingsford-awarded site. The consortium bid S$985 psf per ppr as the second highest bidder, a few cents above Marina Gardens Crescent.

Kingsford’s S$1.03billion parcel is zoned as residential with commercial space in the first story. It can produce about 790 residential units, similar to 775 housing units on the Marina Gardens Crescent.

Marina South MRT lies right beside the Marina Gardens Crescent. It has a gross floor area (GFA), or maximum, of almost 783,000 sf. This is 6% higher than the 738,000 sf maximum GFA for the Kingsford plot.

URA offered the Marina Gardens Crescent land for sale through a tender in 2023. This was done under the confirmed GLS H1 Program 2023 list. The site was placed on a reserve list in the H1-2024 schedule, which will allow interested bidders the opportunity to submit a request for sale at a minimum price that’s acceptable to the Government.

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Sites that appear on the approved list are released for sale in accordance with schedule, regardless to demand. Sites that are on the reserve lists can only be sold after an application is approved by a developer, who has agreed to bid a price minimum that will be acceptable to government.

Marina Gardens Crescent will not likely be activated soon, with more homes being built in the near future.

Skywaters Residences (in the city) and Newport Residences (in the city) are two of those developments which have not yet been made available for sale. The large number of sites available for residential developments in the city may make developers hesitant.

The next time the site goes up for a tender, it will interesting to see what the government does. Especially if there were three or more bids. There will be a close watch on bids that are above the S$984 PSF ppr threshold.

Some developers say that foreign buyers will be less likely to purchase homes due to the 60 percent Additional Buyer’s Stamp Duty.

 

 


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