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About Marina View Site
According to experts, the public bidding for a prime site in Marina View ended on Tuesday (September 21) with just one offer, since developers were wary of the high land and construction expenses, as well as the uncertainties surrounding the office and hotel sectors in the CBD.
Boulevard View submitted an offer of $1,508,000,101, only $101 more than the tender’s minimum price of $1.508 billion. This equates to $1,379 per sq ft per plot ratio (psf ppr), which many experts considered to be “on the low side.”
Boulevard View, a company connected to IOI Properties Group, is most likely the person that initiated the sale of the property, according to them. By Tuesday afternoon, IOI Properties had not responded to The Straits Times’ inquiries.
The Malaysia-listed company is building another white site in Central Boulevard, which it bought for $2.57 billion in November 2016 after triggering its release with a $1.536 billion minimum offer. This equated to a land rate of $1,689 per square foot per year.
Marina View Site Location
“The widespread hollowing out of the CBD, and the delayed and intermittent return to CBD workplaces may have reduced developers’ trust in city living,” said Ms Tricia Song, CBRE’s director of research for Southeast Asia.
Ms Song pointed out that Boulevard View’s offer is lower than the most recent Government Land Sales residential plots auctioned in the CBD.
According to her, One Bernam’s site in Tanjong Pagar got four offers in September 2019, with the highest being $1,462 psf ppr, while the site at Midtown Modern in Tan Quee Lan Street got two bids, with the highest being $1,535 psf ppr.
Ms. Song said that Tuesday’s standalone offer is in striking difference to the recent competitive bidding that has taken place in 5 other suburban or city periphery residential plots this year.
“Each of the plots in Lentor Central, Tampines Street 62, Tengah Garden EC (executive condominium), Ang Mo Kio Avenue 1, and Northumberland received seven to fifteen offers, with bid values exceeding expectations,” she added.
She ascribed the lack of interest in the Marina View property to pressure from unsold residential units in the CBD, as well as possible additional supply from the redevelopment.
Potential of the Site
The white property, which is slated for a mixed-use development including residential, hotel, commercial, and/or serviced apartments, was issued under the Government Land Sales Reserve List for the first half of 2021.
It has the potential to produce 905 residential residences, 2,000 square meters of commercial space, and 540 hotel rooms.
A mixed-use development with residential, hotel, commercial, and/or serviced apartments is planned for the white site.
The tender may have been influenced by very high overall development expenses, which may put the developer at danger.
While the economy is improving, Mr Ong Teck Hui, senior director of research and consulting at JLL, said the epidemic remains a source of uncertainty.
Mr Wong Xian Yang, head of research for Singapore at Cushman & Wakefield, said developer involvement was “below expectation” owing to uncertainties about the return of global travel and the continuing labor shortage in the construction industry.
The lack of additional bids indicates that “most investors continue to be wary about… possibly high development costs associated with an upmarket or premium hotel,” according to Mr Calvin Li, head of transaction advisory services, hotels and hospitality at JLL Asia-Pacific.
Higher development risks have been identified by ERA’s head of research and consulting, Nicholas Mak, as a result of the anticipated lengthier construction timeline and possible repercussions from Chinese property giant Evergrande Group’s financial problems.
“It’s possible that this has put some developers off big-ticket projects,” he added.
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Review of Marina View New Condo
Marina View New Condo | GLS 2021
The white property, which is slated for a mixed-use development including residential, hotel, commercial, and/or serviced apartments, was issued under the Government Land Sales Reserve List for the first half of 2021.
Product SKU: Marina View New Condo | GLS 2021
Product Brand: Property Review
Product Currency: SGD
Product Price: 1890000
Product In-Stock: InStock
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