$442.3m for unique Mount Sophia site

SINGAPORE - A rare residential site in Mount Sophia, a short walk from Dhoby Ghaut MRT station, has attracted a strong bidding contest among nine groups of developers.

The top bid for the 99-year leasehold site - able to yield about 500 homes in the heart of one of Singapore's premier districts - came in at $442.3 million.

That bid, from a consortium comprising Hoi Hup Realty, Sunway Developments and S C Wong Holdings, translates to $1,157 per sq ft (psf) per plot ratio (ppr).

And it fell within experts' forecasts of a winning bid of between $1,150 and $1,200 psf ppr.

The future development will become the biggest residential development in Mount Sophia, noted ERA Realty key executive officer Eugene Lim.

The tender for the historic site, once home to several leading Singapore educational institutions, closed on Tuesday.

The Methodist Girls' School, Trinity Theological College and Nan Hwa Girls' School buildings have been set aside by the Urban Redevelopment Authority for conservation - and must be integrated into the project design.

The No. 2 bid was a hair's breadth - at just 0.1 per cent - behind the top bid at $442 million, or $1,156 psf ppr, and was submitted by a tie-up between Hong Kong-listed group Fantasia Holdings and investment holding firm Singhome Re.

This is the smallest gap between the top two bids for a residential site on record, said SLP International research head Nicholas Mak.

A joint bid submitted by Far East Civil Engineering, Tannery Holdings and Sekisui House came in third at $1,124 psf ppr, 2.9 per cent lower than the winning bid.

Experts said that the results were a signal that developers are still bullish on land sites with special attributes, such as this site's central location - also within walking distance to Plaza Singapura.

Colliers International director of research and advisory Chia Siew Chuin said that the site's appeal lay in its location in the upscale District 9.

"The land parcel is unique, as the Government rarely releases for sale residential sites located in the prime District 9 area," she said.

Mr Mak also said that it is the last residential site in this district that the Government will put up for sale this year.

Bids for the 23,771 sq m site were also lodged by UOL Group, Wing Tai Holdings, and EL Development, which offered the lowest bid at $284.8 million.

The site was put up for sale on the confirmed list of the Government Land Sales programme in June.

Analysts estimate the developer's breakeven price to be $1,650 to $1,750 psf.

Units at the future development are also likely to sell at $1,900 psf at its launch.

Nearby, at the 103-year leasehold 8@Mount Sophia, units changed hands at an average transacted price of $1,650 psf from January to last month.

The future development will also be near the Singapore Management University and the School of the Arts.

This means buyers can expect attractive rental yields, as the high student population could mean strong rental demand in the area, said Knight Frank research head Alice Tan.

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