However, last year's cooling measures may have resulted in its subdued land rate of $1,192.
The residential site in Kampong Java has closed its tender and has been won by CELH Development at $418m, the Urban Redevelopment Authority (URA) revealed. Considering the price tag, the land rate falls to about $1,192 psf/pr.
CELH surpassed GLL’s bid by about $1m to secure the site. In total, seven bids competed as of tender closing.
Easily accessible via Dunearn Road, Kampong Java Road, Central Expressway (CTE) and Newton MRT Interchange Station, the land parcel is also near amenities and institutions such as the Anglo-Chinese School and Newton Food Centre. Meanwhile, shopping malls such as Velocity@Novena Square, United Square and ION Orchard are a short MRT ride away.
“The upcoming development on the land parcel will appeal to investors, as it has a strong catchment of tenants who work in the Novena medical cluster, CBD and Orchard Road,” Lee Nai Jia, Senior Director and Head of Research, Knight Frank Singapore commented. “Breakeven is expected to be approximately $1,600 per sqft, depending on the building materials used.”
Meanwhile, Ong Teck Hui, Senior Director, Research & Consultancy noted that the wide gap between the top bid of the site compared to sites sold before the cooling measures shows that residential prices within the area has ultimately softened. Such projects include Makeway View sold at $1,626 psf/pr, Dunear Gardens sold at $1,914 psf/pr, and Chancery Court sold at $1,610 psf/pr.
“There may be uncertainty as to whether the top bid of $1,192 psf/pr meets the URA’s reserve price,” Ong commented. “However, it reflects current market sentiments as it takes into account the unfavourable supply and demand conditions affecting the market.”
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