Far East-Sekisui Place Top Bid for Singapore site

Hillview Rise site looks ready to be excavated

A joint venture between Singaporean builder Far East Organization and Japanese house Sekisui emerged as the highest bidder for one of two residential land sales in Lion City that closed on Thursday night. Analysts, however, were quick to point to the low turnout and tight bidding prices in the auction pair as evidence of a more cautious mood among developers.

Urban Redevelopment Authority (URA) auction results showed that Far East Civil Engineering, a unit of Singapore’s real estate heavyweight, and Sekisui House, one of Japan’s largest housebuilders, did the best 320.78 million Singapore dollars ($225.6 million) bid for 10,395 square meter (111,890 sq ft) Site on Hillview Rise in Upper Bukit Timah – overbid bids submitted by SGX UOL-listed companies Group, City Developments Ltd and Sim Lian Group.

The second site, located between Beauty World Center and Bukit Timah Plaza, attracted five bids, with local builder Bukit Sembawang Estates making the highest bid for the 4,611 square meter site at S$200 million (141.3 millions of dollars). If rewarded, the Bukit Timah Link site would be Bukit Sembawang’s first win in a government land sale.

“Developer participation in these latest public land tenders has been less active than expected, particularly for the Bukit Timah Link site,” said Wong Siew Ying, head of research at PropNex Realty. “Despite strong sales performance in recent launches, the level of participation is indicative of developers’ sense of caution – who are likely wary of global headwinds and economic uncertainties ahead, particularly the risk of a recession. world in 2023.”

Long-term partners return to the charge

The best bids for both auctions have drawn mixed reactions from analysts, as Wong considers the best bids to be in line with his agency’s expectations, while Lam Chern Woon, head of research and consulting at Edmund Tie, considers that the bid prices are “fairly moderate”.

Marc Boey, Executive Director of Real Estate Services at Far East International

Lam said the top bid for the Bukit Timah Link site was in line with previous predictions, while the other bids were more conservative. For the Hillview Rise site, he said the small difference between the offers “reflected the caution of developers in a considerably uncertain climate”.

“Rising interest rates could be seen to impact housing affordability and demand in the suburban area,” he added.

The Far East-Sekisui House joint venture has offered to pay S$1,024 per square foot of the Hillview Rise site’s maximum gross floor area of ​​313,305 square feet, which could yield up to 335 new homes near the station. MRT Hillview on the Downtown line. Its bid of S$320.8 million for the 99-year-old leasehold land was only 1.25% higher than CDL’s second-highest bid of S$316.8 million.

“This represents a great opportunity for Sekisui House and Far East Organization to create another remarkable residential property in the Upper Bukit Timah enclave,” said Marc Boey, Executive Director of Property Services Division at Far East International.

If awarded, the next Hillview Rise project will add to a series of joint developments by the two property heavyweights, who worked with Frasers Property to build the Waterway Point residential and retail complex in Punggol in 2016.

Currently, a Far East-Sekisui House joint venture, together with Hong Kong’s Sino Group (which, like Far East Organization, is controlled by Singapore’s Ng family), is developing the 372-unit Reserve Residences in Tampines with the intention of launch the project early next year. This luxury residential development is located less than 10 minutes drive from Hillview Rise.

PropNex estimates that homes in the Hillview Rise project will cost around S$2,000 per square foot. This rate would reflect a nearly 15% premium to the current average selling price of S$1,712 per square foot for Hong Leong’s Midwood project at Hillview Rise.

Building on past successes

Bukit Sembawang’s bid for the Bukit Timah Link lease site – which is located just a 10-minute drive south of the Hillview Rise land – equates to S$1,341 per square foot of the project’s maximum GFA of 148,908 feet squares.

Bukit Sembawang GLS

Bukit Sembawang is set to score its first victory in a government land sale

To secure its first-ever win in a government land sale, the SGX-listed developer bid 15.7% more than its closest competitor, a unit of Wing Tai Holdings which bid 172.9 million Singapore dollars for the site.

The five tenders were only half of the 10 bids PropNex’s Wong was expecting for the 4,611 square meter site.

Propnex estimates that houses in the Bukit Timah Link project will cost around S$2,400 per square foot. Bukit Sembawang’s win came after the developer sold more than three-quarters of its 298-unit [email protected] condo in District 15 during its launch weekend in May at an average sale price of $2,387. Singaporeans per square foot.

Knight Frank Singapore’s head of research, Leonard Tay, said the development could still attract “strong interest” from homebuyers given its location close to the Beauty World MRT station and high sales recorded when BBR Holdings launched the adjacent The Linq @ Beauty World project two years ago.

“Although the pool of potential buyers may now be smaller due to the clouded economic outlook, the more acceptable total of around 160 residential units would mitigate some of the development risk,” Tay added.

URA data showed private house prices in the city-state rose 3.8% in the third quarter from the previous three months – up for the 10th consecutive quarter despite the government a imposed two rounds of property cooling measures in the space of nine months.