The Urban Redevelopment Authority (URA) has just closed the land tender for two land parcels, one site at Upper Thomson Road, and one site at River Valley Green. Upper Thomson Road (Parcel A) can yield around 540 conventional housing units, and 100 to 145 long stay Serviced Apartments (SA2) units. There will also be up to 2,000 sqm of commercial space on the site, alongside an early childhood development centre. The plot at River Valley Green (Parcel A) can generate around 380 residential units.
Upper Thomson Road (Parcel A)
No bids were received for this plot. Comparatively, only one bid was received for the adjacent Parcel B plot which was awarded to GuocoLand (Singapore) Pte. Ltd. and Intrepid Investments Pte. Ltd. earlier in April 2024, at the bid price of $779,555,000 or around S$905 psf ppr.
There are some factors that could have contributed to this site not receiving bids. The complex site-specific requirements including developing SA2 units, a childcare centre, as well as a commercial component may also have deterred some developers from participating in this tender as the project may have been more complex.
This is also the second land tender to close that has a SA2 component to it. With currently no serviced apartments or hotels of any sort in the vicinity, there may be some risk in bringing in SA2 units, which are untested, to this locale. The first plot with SA2 units, at Zion Road (Parcel A), is in the CCR with other serviced apartments nearby, which may have led to more confidence for that particular development.
The adjacent Parcel B plot which was awarded recently may also have affected the response to this site. Parcel B can yield around 940 housing units. Developers may not want to compete against a large project just next door. They may also be waiting for other land parcels that will be announced when the 2nd Half 2024 GLS programme is released.
River Valley Green (Parcel A)
There were just two bids received for this site; the highest bid was from Winchamp Investment Pte. Ltd. with a bid of S$463,999,999 or around S$1,325 psf ppr. This was 4.3 per cent higher than the other bid from Hong Realty (Private) Limited which was S$444,888,888 or around S$1,271 psf ppr. Both bids were higher than the winning bid for Zion Road (Parcel A) which went for around S$1,202 psf ppr.
The site is well located, a short distance away from Great World City and Great World MRT station on the Thomson-East Coast Line, providing retail and dining amenities alongside transport connectivity. It is also a purely residential site with no SA2 units, and the number of units in this development is not too large. However, the shape of the plot and the complexity of the site being just next to the Great World MRT station may make it more challenging as well from a construction perspective.
Existing new projects in the vicinity, such as Irwell Hill Residences and The Avenir, have a handful of units left or are fully sold out. The last time a GLS land parcel was sold in D9 was also the plot for Irwell Hill Residences, which was awarded in January 2020. With a limited new supply of homes, developers may sense a potential for healthy demand for future developments.
However, given that this is a prime parcel in the CCR, developers will be mindful of the higher-for-longer interest rates, macroeconomic uncertainty, and the ABSD increase for foreign buyers. Developers may also have been cautious of the other GLS sites in the vicinity; Zion Road (Parcel A) which has been sold, Zion Road (Parcel B) which has been launched for sale, and River Valley Green (Parcel B) which is available for application on the Reserve List. Hence, there may be more eyes on the upcoming 2nd Half 2024 GLS programme for other alternative sites.