Three residential GLS sites in Lentor released for sale
Three residential GLS sites in Lentor released for sale. Under the 1H2022 Government Land Sales (GLS) Program, the government has put up for sale a land parcel each in Lentor Central, Lentor Gardens, and Lentor Hills Road (Parcel B). According to URA, the three GLS sites could result in 1,265 new residential units.
Under the Confirmed List, two of the residential plots, Lentor Central and Lentor Hills Road (Parcel B), have been put up for public tender. Meanwhile, the Reserve List is accepting applications for the land lot at Lentor Gardens. This means that a developer must submit an acceptable minimum bid to URA in order for the site to be put out to public tender.
The new GLS properties join the Lentor area’s redevelopment land pool, which also comprises previously awarded sites at Lentor Central and Lentor Hills Road (Parcel A).
In July 2021, GuocoLand purchased the prior GLS site at Lentor Central for $784 million ($1,204 psf per plot ratio, or psf ppr). The site will be redeveloped into the 600-unit Lentor Modern, according to the developer. After submitting the highest proposal of $586.6 million ($1,060 psf ppr) in January, a joint venture consisting of Hong Leong Holdings, GuocoLand, and TID was granted Lentor Hills Road (Parcel A).
According to Lee Sze Teck, senior director (research) at Huttons Asia, if the two recently available plots are successfully sold, the total supply pipeline of residential units in the Lentor area will reach roughly 1,935 dwellings.
“The supply of 1,935 homes may be adequate to meet the pent-up demand in the area,” he continues, “therefore the Reserve List site at Lentor Gardens may not be triggered for sale.” As a result, despite developers’ need to replace their depleted landbanks, demand in the two newly released sites may be more lukewarm than anticipated.
“In light of the increasing risks posed by the cooling measures and growing building prices, developers may be hesitant to purchase land in areas where there is adequate supply,” Lee says. Developers may turn to other accessible GLS sites or the en bloc market, he adds. (Use the en bloc calculator to find possible condos.) Wong Siew Ying, head of research and content at PropNex Realty, shares this sentiment. “We believe developers will be interested in these two sites,” she says, “but they will be wary of two other nearby plots that have recently been sold and may be more circumspect in their bids.”
Given the anticipated supply in the neighborhood, she also believes the new Reserve List site will not be activated for sale this time.
ERA Realty Network’s head of research and consultancy, Nicholas Mak, believes that despite the publication of two new projects and additional redevelopment, developers will still be interested in bidding on the newly launched Confirmed List sites. “This is because the availability of unlaunched private residential units in the OCR [Outside Central Region] is quite limited.” Furthermore, as a result of the cooling measures, a greater proportion of private house buyers will be Singaporeans and permanent residents. “Typically, this category of consumers prefers mass-market condominiums,” Mak explains. As a result, mass-market condominium developers will see constant demand and face less competition.
He estimates that the tender for the site at Lentor Central will receive six to eleven bids, while the tender for the site at Lentor Hills Road (Parcel B) would receive four to eight bids. The top bid for the Lentor Central site is expected to be between $499 million ($1,149 psf ppr) and $550 million ($1,267 psf ppr), while the top bid for the Lentor Hills Road (Parcel B) is expected to be between $255 million ($1,043 psf ppr) and $289 million ($1,182 psf ppr).
On September 13, the tender for the Lentor Central and Lentor Hills Road (Parcel B) sites will close.
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