The Hougang Avenue 2 residential site has attracted the highest bid of S$207.5 million from MCL Land at the closing of its public tender by the Urban Redevelopment Authority.
The bid works out to S$456 per square foot per plot ratio.
This is 9.6 per cent higher than the second highest bid of S$189.3 million submitted by Frasers Centrepoint.
The site has attracted a total of seven bids, with the remaining bids ranging between S$171 million and S$181.3 million.
Other developers that submitted lower bids include Guocoland Retail Management and Cove Residential of Capitaland.
The Hougang land parcel has a site area of 30,195.5 square metres.
It can yield a maximum gross floor area of some 42,274 square metres.
It has a 99-year lease and the building heights on the site cannot exceed five storeys.
Property consultancy firm CBRE Research’s Executive Director Li Hiaw Ho said while the number of bids are within expectations, the bidding prices are fairly bullish.
He said the breakeven cost is about S$780 to S$800 per square foot for a low-rise condominium project.
Mr Li also said the new project may fetch around S$900 to S$950 per square foot when launched in 2011, looking at the selling prices of new apartment projects in the vicinity.
He added that the developer can also choose to develop a cluster project of about 200 units.
Mr Nicholas Mak, Real Estate lecturer of Ngee Ann Polytechnic, said the developer is likely to develop mostly non-landed homes of about 350 units on this site.
He also said it may come with about 15 to 20 strata-landed houses.
He also notes that MCL bidded more aggressively after being unsuccessful in the previous five land tenders.
URA will evaluate the tender bids and announce the award of the tender at a later date.
Source : Channel NewsAsia – 20 May 2010