Why Fernvale home site tender keeps developers excited amidst muted market outlook

It can yield about 600 homes.

It is quite uneasy for developers to venture into a new condominium project especially under the Government Land Sales (GLS) system since all units need to be completely sold within five years if the additional buyer stamp duty is to be avoided. But what is with recently launched Fernvale Road land parcel that lures developers?

"To illustrate, we saw keen competition for the latest land parcel at Fernvale Rd offered under the GLS tender, which attracted 14 bidders and a top bid of S$287.1m (S$517.0 psf pr)," a recent report from OCBC Investment Research said.

According to the report, the 99-year leasehold Fernvale Road site is attractive due to its robust sales potential.

The report took note that the site, which is less than 100m from the Thanggam LRT station, has attracted developers as it can yield about 600 homes.

OCBC also noted that it has its meaningful size a-$620 million estimated gross development value. The research firm stated that this would "move the needle for most developers".

More so, it has potential for strong sales given the absence of competing launches coming up in the area and the successful launch last year of nearby 1390-unit High Park Residences, which is now 98% sold.