Pheng Geck site draws 13 bids, led by $114.8m offer

HOME-GROWN construction group Santarli yesterday emerged as top bidder for a 99-year private condo site at Pheng Geck Avenue.

The site near Potong Pasir MRT Station drew a whopping 13 bids. Analysts say this reflects developers' confidence in a choice city-fringe site near an MRT station.

The top bid from Santarli Corporation - at $114.8 million or $628.22 per square foot per plot ratio (psf ppr) - was at the upper end of expectations. Santarli's bid came in $1.05 million or 0.9 per cent above the next highest offer of $622.47 psf ppr by Overseas Union Enterprise (OUE) unit OUE Reef Development.

Santarli executive director Chan Thiam Seng told BT yesterday that the group's breakeven cost will be slightly above $1,000 psf and it is looking at an average selling price of about $1,300 psf for its proposed project, which it hopes to launch in about nine months. Santarli's scheme involves an 18-storey development with about 240 units, comprising mostly two and three-bedroom apartments, although there will also be some one and four-bedders.

The first was sold in June 2010 for about $607 psf ppr to Qingdao Construction, which is developing the plot into Nin Residence. The condo was launched last year and based on caveats data, achieved an average price of about $1,225 psf, although smaller units generally sold at $1,300-1,500 psf.

In August last year, Tuan Sing clinched the site next to the one tendered yesterday for $567 psf ppr.

The higher unit land price achieved at the latest tender will give Tuan Sing greater flexibility in pricing strategy when it launches its project.

Also, there is a fair bit of supply in the area from other projects near MRT stations including unsold units at Eight Riversuites and Bartley Residences as well as a yet to be launched project at Mount Vernon Road.

ERA Realty Network's key executive officer Eugene Lim highlighted that the land opposite the site tendered yesterday is zoned for commercial development, and a shopping centre the size of Nex may be built on it in future.

Source: Business Times – 29 June 2012