The Urban Redevelopment Authority (URA) has just closed the land tenders at Canberra Crescent, De Souza Avenue, and Zion Road (Parcel B) under the 1H2024 Government Land Sales (GLS) programme. Canberra Crescent can yield an estimated 375 units, De Souza Avenue can yield around 355 units, and Zion Road (Parcel B) can yield an estimated 610 units.
Canberra Crescent
There were three bids received for this site, which was within our expectations. The highest bid came from Peak Nature Pte Ltd and Huatland Development Pte. Ltd., with a bid of S$279,000,800 or approximately S$793 psf ppr. This was 1.4 per cent higher than the next highest bid.
Part of the interest in the site may have come from the locational attributes of the site. The plot is close to Bukit Canberra, which will provide shopping, dining, and recreational amenities to the future residents here. Homeowners will also be within a 10-minute walk to Canberra MRT, granting them better connectivity to the rest of the island.
Given that the site is of medium size, it should fit within the risk appetite of most developers as well. There may be some pent-up demand for homes in the area, as the last two new launches in Sembawang, The Commodore and The Watergardens at Canberra, were in 2021. Both projects are fully sold out, and there are no other land parcels marked for sale in the near future after the announcement of the 2H2024 GLS programme. There may be enough pent-up demand to sustain sales at this location when the future project launches.
The shape of the site may also add to the complexity of the future development, coupled with the land harmonisation rulings. These may have been some of the considerations for developers bidding for this site that may have prevented exuberant bid prices from being submitted.
De Souza Avenue
There were two bids received for this site, which was within our expectations. The highest bid came from SL Capital (8) Pte Ltd, with a bid of S$278,900,000 or S$841 psf ppr. This was 22.3 per cent higher than the other bid, which was S$228,000,000 or S$688 psf ppr.
There has been keen demand for homes in the Upper Bukit Timah area. While there has been a steady supply of new homes, the existing residential units in the vicinity have been largely absorbed. The latest new project launch in the area was The Reserve Residences, which only has 39 unsold units out of 732 units as of June 2024’s Monthly Developer Sales data. There is one more small development from an earlier GLS at Bukit Timah Link which was awarded in November 2022 that is yet to be launched as well. With a limited supply of new homes in the area, the future project may be attractive to potential buyers who appreciate the close proximity to nature.
Despite the recent good performance of previous projects launched in the Upper Bukit Timah location, this site is not as conveniently located as it is a distance from the Beauty World MRT Station and the other amenities along Upper Bukit Timah Road. Some of the other tender requirements, such as having to inspect and clear out the existing buildings on the site may also add to the development cost, which may have been reflected in the bid prices as well.
Zion Road (Parcel B)
There were two bids received for this site, and the highest bid came from Valerian Residential Pte. Ltd., with a bid of S$730,088,888 or S$1,304 psf ppr. This was 10.5 per cent higher than the other bid. The highest bid was 20.8 per cent above the reserve price that was accepted by the government, which was S$604,567,890 or S$1,080 psf ppr.
The site enjoys many of the same locational attributes to the adjacent Parcel A site, such as the excellent location, the proximity to an MRT station, and various retail and dining amenities nearby. This site may have been more attractive than the earlier plot that was just awarded in April 2024, resulting in more bids and a higher bid price psf ppr. The lack of requirement to provide long-stay serviced apartments in this particular site would make this project less complex and risky. This may explain the 8.5 per cent premium on a psf ppr basis compared to the earlier Parcel A site which was awarded at around S$1,202 psf ppr. The Parcel B site also has a significantly lower overall maximum GFA, resulting in an overall smaller price quantum for the whole project compared to the neighbouring Parcel A site which also has more development conditions.
Besides the Zion Road (Parcel A) site awarded in April 2024, River Valley Green (Parcel A) was recently awarded in June 2024. River Valley Green (Parcel B) will be launching in October 2024 under the Confirmed List of 2H2024 GLS, and another nearby parcel, River Valley Green (Parcel C) was made available on the Reserve List and will be launching for application in December 2024. There may be still developers sitting on the sidelines who are waiting for other opportunities in the area.