In 2023’s maiden government land sales (GLS) tender for a 99-year leasehold private residence, a site along Lentor Gardens in the Yio Chu Kang district has drawn just 1 bid.

SGX-listed GuocoLand collaborated with Hong Leong Holdings’ Intrepid Investments to submit the bid of S$486.8 million, or around S$985 per square foot per plot ratio (psf ppr).

Analysts attribute the lukewarm participation for the tender, which ended on Tuesday (4 April 2023), mainly to a prospective oversupply in the zone, the new Lentor Hills Estate. The Urban Redevelopment Authority (URA) has released a slew of plots in the last couple of years, and with more to come.

The GuocoLand-Intrepid bid was at the lesser end of the S$950-to-S$1,150 psf ppr range, which analysts had forecast when polled by The Business Times on Monday. They had anticipated the plot to attract 2 to 5 bids.

Following the URA’s announcement of the provisional tender outcomes on Tuesday evening, most real estate consultants commented they expected the plot to be awarded to the sole bidder. As property veteran Nicholas Mak says: “In spite of the low land rate of the sole bid, it is within a reasonable range of the valuation for the site.”

The previous time that a Government Land Sales (GLS) plot for private residences drew just one bid was at Silat Avenue in 2018.

The sole bid for the Lentor Gardens site is the least unit land rate recorded among the 5 sites at Lentor Hills Estate for which state tenders have concluded since July 2021. It is about 11% less than the winning bid of S$1,108 psf ppr for the Lentor Central plot, and nearly 13% below the S$1,130 psf ppr top bid won for Lentor Hills Road (Parcel B) at the most recent tender in September 2022.

A spokesperson at GuocoLand said: “For this Lentor Gardens site, we are envisioning a prestigious residential project with about 533 units, and with 600 square metres (6,458 sq ft) of childcare facilities, named Lentor Mansion.”

Mr Steven Tan, chief executive officer of OrangeTee & Tie, said: “The final launch price may range from S$1,950 to S$2,050 psf.”

Under URA’s tender conditions for the plot, the Lentor Mansion site will be connected to the Lentor MRT station by covered linkways.

Established schools such as CHIJ St Nicholas Girls’ School, Presbyterian High School and Anderson Primary School are nearby.

At the Lentor Modern project, which was the first site awarded in 2021 to GuocoLand, 87.3% or 528 out of the 605 units have transacted since sales began in September 2022. The median price as at 19 March 2023 was S$2,107 psf, mentioned PropNex, citing URA Realis data.

The Lentor Hills Residences project, to be developed on the second site that was sold, will have 598 units.

TID Residential also bagged Lentor Hills Road Parcel B in September 2022, to be developed as the Lentoria project. Mr Lam Chern Woon, Edmund Tie’s head of research and consulting, commented that some smaller developers may have foregone Tuesday’s tender, “given the stronghold of key property players like GuocoLand and Hong Leong, which have together been awarded 3 of the 4 sites launched previously”.

Lam added: “The modest bid rate by GuocoLand-Intrepid in the recent tender reflects a careful approach to maintaining their market presence, while ensuring that they can price the eventual units in an affordable, yet profitable manner.”

Source: https://www.businesstimes.com.sg/property/guocoland-hong-leong-holdings-tie-sole-bidder-lentor-gardens-site-ura-tender