The 144,657 sq ft GLS site at Lentor Central could yield about 470 residential units, (Picture: URA)
SINGAPORE (EDGEPROP) - The government has launched a land parcel each at Lentor Central, Lentor Gardens and Lentor Hills Road (Parcel B) for sale under the 1H2022 Government Land Sales (GLS) Programme. Collectively, the three GLS sites could yield about 1,265 new residential units, says URA.
Two of the residential sites, Lentor Central and Lentor Hills Road (Parcel B), have been launched for sale by public tender under the Confirmed List. Meanwhile, the land parcel at Lentor Gardens is available for application under the Reserve List. This means that a developer needs to submit an acceptable minimum bid to URA to trigger the public tender for the site.
The new GLS sites add to the pool of development land in the Lentor area, which includes previously awarded sites at Lentor Central and Lentor Hills Road (Parcel A).
The newly released GLS Confirmed List sites at Lentor Central and Lentor Hills Road (top and bottom, in orange), as well as the Reserve List site at Lentor Gardens (left, in orange), add to two previously awarded GLS parcels in the immediate neighbourhood. (Source: URA)
The previous GLS site at Lentor Central was sold for $784 million ($1,204 psf per plot ratio, or psf ppr) to GuocoLand in July 2021. The developer has announced plans to redevelop the site into the 600-unit Lentor Modern.
A joint venture comprising Hong Leong Holdings, GuocoLand and TID was awarded Lentor Hills Road (Parcel A), after the consortium submitted the top bid of $586.6 million ($1,060 psf ppr) in January this year.
If the two newly released plots are successfully sold, it would bring the total supply pipeline of residential units in the Lentor area to about 1,935 homes, says Lee Sze Teck, senior director (research) at Huttons Asia.
The 116,412 sq ft site at Lentor Hillls Road (Parcel B) could yield about 265 residential units. (Picture: URA)
But he adds that “the supply of 1,935 homes may be sufficient to meet the pentup demand in the area, hence the Lentor Gardens site on the Reserve List may not be triggered for sale”. As a result, the level of developer interest in the two freshly released sites might be more lukewarm than expected, despite developers’ need to replenish their depleted landbanks.
“In the face of increased risks from the cooling measures and rising construction costs, developers may not want to buy land in an area where there is ample supply,” says Lee. He adds that developers might turn to other available GLS sites or the en bloc market. (See potential condos with en bloc calculator)
This sentiment is shared by Wong Siew Ying, head of research and content at PropNex Realty. She says: “We think developers will be keen on these two sites, but they will be mindful of two other nearby plots that have been sold recently and maybe more judicious with their bids.”
She also says the new Reserve List site is unlikely to be triggered for sale this time round, considering the upcoming supply in the area.
According to EdgeProp’s Landlens tool, the possible selling price of Lentor Modern could be approximately $2,320 psf. (Source: EdgeProp Singapore)
However, Nicholas Mak, head of research & consultancy at ERA Realty Network, believes that despite two new projects and more development land released, developers will still be interested to bid for the newly launched Confirmed List sites.
“This is because the supply of private residential units in the OCR [Outside Central Region] that are yet to be launched is very low. In addition, the cooling measures means that an increasing proportion of the private home buyers will be Singaporeans and permanent residents. This group of buyers typically prefer mass-market condominiums,” says Mak. Thus, developers marketing mass-market condominiums will enjoy steady demand and face less competition.
The tender for the site at Lentor Central could attract six to 11 bids, while the site at Lentor Hills Road (Parcel B) could draw four to eight bids, he says.
Mak expects the top bid for the Lentor Central site to range from $499 million ($1,149 psf ppr) to $550 million ($1,267 psf ppr), and the top bid for the Lentor Hills Road (Parcel B) to be between $255 million ($1,043 psf ppr) and $289 million ($1,182 psf ppr).
The tender for the sites at Lentor Central and Lentor Hills Road (Parcel B) will close on Sept 13.
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