2 Dec CapitaLand unit offers top bid for Bishan site

PHOTO: 2 Dec CapitaLand unit offers top bid for Bishan site

Capitaland, in a joint venture with Mitsubishi Estate Asia, offered the top bid for another residential site in Bishan, next to its current Sky Habitat development.

The US$505 million (S$616 million) , or $852.94 per square foot per plot ratio (psf ppr), bid was submitted through Allamanda Residential Development in which CapitaLand holds a 75 per cent stake.

According to market analysts, the CapitaLand JV top bid for the residential site at Bishan Street 14 was part of a strategic move to defend its earlier bid of $869.36 which was offered in February last year for the Sky Habitat site.

CapitaLand Residential chief executive officer Wong Heang Fine said: "CapitaLand Residential Singapore and Mitsubishi Estate Asia are pleased to have submitted the top bid for the Bishan Street 14 site, which is strategically located next to Sky Habitat. The joint venture plans to develop this well-located 11,227.80 sq m site into a condominium with approximately 700 units, which is expected to be launched in the second half of 2013."

The second highest bid was a joint submission by SingLand Homes, UOL Venture Investments and ORIX Investment & Management for $827.61 psf ppr.

This was 3.1 per cent lower than CapitaLand's top bid.

Given that both the first and second highest bidders for the Bishan Street 14 plot submitted prices comparable to the record price set by CapitaLand for its Sky Habitat site, it could suggest that developers are confident about the current average selling price of the 99-year condominium project located in Bishan Central on Bishan Street 15.

Said Lee Sze Teck, senior manager, training, research and consultancy at DWG: "The estimated breakeven price could be between $1,350 and $1,400 psf and the probable selling price could be between $1,650 and $1,700 psf which is similar to Sky Habitat's selling prices."

However, unlike the bid for the Sky Habitat site, which drew close to 20 bidders, yesterday's tender for the site at Bishan Street 14 attracted only nine bids.

"There are less bidders contesting for this site compared to the earlier tender because the interested parties know that bidding will be very competitive, so unless they are prepared to put in a robust offer, they might as well not try," explained Ong Teck Hui, Jones Lang LaSalle's national director, research and consultancy.

Pinehill Investments and a consortium comprising Frasers Centrepoint's FCL Topaz, Far East Orchard Limited and China Construction (South Pacific) Development, were tied in third place for their bid of $780.16 psf ppr.

Other bidders for the subject site included Straits Steamship Land's wholly owned subsidiary Acresvale Investment ($770.68) and MCL Land Limited ($759.90).

According to Mr Ong, the relatively high bids suggest a healthy demand among developers.

"Other than the top two bidders, most of the others placed bids above $700 psf ppr, keeping with recent observations that bidders seem to be prepared to pay more for sites under current market conditions."

The lowest bid was by Mezzo Development for $621.42 psf ppr.