A RESIDENTIAL site in Choa Chu Kang Drive has attracted a top bid of just $203 per square foot per plot ratio (psf ppr), reflecting weak sentiment in the property market.

The Urban Redevelopment Authority (URA) yesterday closed the tender for the 99-year leasehold site, which has a maximum gross floor area of 572,600 square feet.

The tender drew five bids - Tian Hock Properties came out tops with an offer of $116.01 million, or $203 psf ppr.

This was 7.4 per cent higher than the next highest bid - from Sim Lian Land, at $108 million or $189 psf ppr. The lowest offer came from HHA Properties - at $80.2 million or $140 psf ppr.

Analysts had expected bids ranging from $230 to $270 psf ppr, or $131.7 million to $154.6 million in all.

'The lower quantum of the bid prices is a reflection of the current subdued mood in the residential market, taking into account the current cautious environment and the relatively lacklustre take-up of new projects in the first four months of the year,' said CB Richard Ellis Research's executive director Li Hiaw Ho. But five bids reflect 'fairly good interest in the site', he added.

The director of research and advisory at Colliers International, Tay Huey Ying, noted the absence of larger developers such as Far East Organisation, saying this could be a sign of weak market sentiment.

While the bids for this site were 'healthier compared with recent ones received for the Ten Mile Junction site', Ms Tay also feels the bids were in 'the lower range of expectations'.

A site at Choa Chu Kang Road and Woodlands Road, where the state-owned Ten Mile Junction currently sits, recently drew a top bid of only $61 million or $162 psf ppr.

Market observers believe that URA may nevertheless award the site. According to Ms Tay, the 'bid price is fair under current market conditions', and the project may result in a breakeven cost of about $550 psf and a selling price of $610-$620 psf.

Mr Li also reckons the top bid for Ten Mile Junction was 'reasonably fair'. Based on the bid, he estimates a breakeven cost of $580-$600 psf, which would translate to a selling price of about $650 psf.

URA launched the tender for the Choa Chu Kang Drive site in March and will decide on a possible award after evaluating the bids.

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