The Urban Redevelopment Authority has just closed the land tenders for two sites, at Dairy Farm Walk and Tengah Garden Avenue under the 1H2024 Government Land Sales (GLS) programme. The plot at Dairy Farm Walk can yield around 540 units, while the plot at Tengah Garden Avenue may supply around 860 units and 3,000 sqm of commercial space.
Dairy Farm Walk
There were two bids received for this plot, which was within our expectations. The highest bid was from SNC2 Realty Pte. Ltd., Apex Asia Alpha Investment Two Pte. Ltd., Soon Li Heng Civil Engineering Pte Ltd and Kay Lim Realty Pte. Ltd. at a bid price of S$504,515,000 or S$1,020 psf ppr. This was 23.1 per cent higher than the next highest bid from Sim Lian Land Pte Ltd and Sim Lian Development Pte Ltd, which was S$410,000,000 or around S$829 psf ppr. The highest bid price slightly exceeded our initial expectations, which may indicate some confidence in the potential of this site.
The most recent GLS plot sold in the vicinity was the parcel awarded in March 2022 to Sim Lian Land Pte Ltd and Sim Lian Development Pte Ltd at a land rate of S$980 psf ppr. This site was awarded before the GFA harmonisation and is now being developed as The Botany at Dairy Farm, which is almost fully sold out.
This will be the largest new development in recent years in the Dairy Farm area. This site can generate around 540 units, while The Botany at Dairy Farm has 386 units and Dairy Farm Residences has 460 units. There are also other land parcels launched for sale in the Dairy Farm/Hillview vicinity, as there are land parcels that have been zoned for Residential use but not sold yet. Developers may therefore be waiting for other choices.
However, as private homes in the area continue to be bought by homebuyers amidst one unit left for sale at The Botany at Dairy Farm, there may have been greater confidence for a new development in the area. Moreover, the proportion of new OCR launches in 2025 may be lower this year, which could have resulted in the interest for this site.
Tengah Garden Avenue
There were three bids received for this plot, which was within our expectations. The highest bid was from Intrepid Investments Pte. Ltd., CSC Land Group (Singapore) Pte. Ltd. and GuocoLand (Singapore) Pte. Ltd.at a bid price of S$675,000,000 or S$821 psf ppr. This was 0.7 per cent higher than the next highest bid from Kingsford Huray Development Pte Ltd, which was S$670,108,000 or around S$815 psf ppr. All three bids were within close range of each other, but were below our expectations. This may be due to the larger size of the plot, which would have resulted in a larger overall price quantum. Interest in this site may also have been moderated by the current unsold inventory from the nearby Jurong Lake area and an upcoming GLS site along Lakeside Drive and Lakeside MRT which will be launching in April 2025, which some developers may be waiting for.
This is the first non-EC private land parcel in Tengah. Three EC sites have been awarded since 2021. With no other private land parcels nearby in the vicinity in recent years, developers will have the first-mover advantage in building and developing the first private residential project in Tengah.
With limited private homes in the area, there may also be potential demand from homebuyers for the future project at this parcel, which may include those who do not qualify for ECs or exceed the current EC income ceiling of S$16,000 but still wish to live in Tengah.