Marina Gardens Crescent bidders ‘too low to award plot’: URA
The Marina South white site, which is designated for commercial and residential development, only received one bid at S$770.5m, or S$984/sqft per plot ratio.
Market watchers weren’t surprised by URA’s decision. The URA had waited longer than usual for the result of an official tender.
Last year, GLS land sites in Clementi and Toa Payoh that were further away from the cities, such as Clementi Road, attracted higher rates.
The bid was rejected for being “too small” in a Government Land Sales (GLS), a highly-publicized tender.
Urban Redevelopment Authority – URA – has determined that the only bid submitted by GuocoLand Singapore and Intrepid Investments as well as TID Residential is too low.
Three weeks ago, the market players expected the tender not to be awarded because the land rate was below expectations. The bid price for the plot was 30 per cent less than what Kingsford Group, which bought a neighboring plot on Marina Gardens Lane through a closed state tender in June of last year, paid.
It is worth noting that a joint-bid by GuocoLand Group, Intrepid Investments and Guoco Group had been made for the Kingsford award site. The consortium, which was second in line at S$985psfppr (just a shade higher than Marina Gardens Crescent), came in as the highest bidder.
Kingsford’s S$1.03billion ($1.13billion) plot is zoned as residential with commercial space in the first story. The plot is capable of producing 790 private homes. This is the same as the 775 private units on the Marina Gardens Crescent.
The GuocoLand group and Hong Leong-related entities bid on the downtown plot was also lower than a top bid placed for a site located in a western suburb. Qingjian Realty’s joint venture with Forsea bid S$1,191psfppr for the Media Circle parcel which was also offered on January 18. URA has now awarded the parcel at this bid. It was almost S$395.3million.
The measured bid on the Marina Gardens Crescent site reflects an approach that is cautious when it comes to large sites, which require significant land costs and development expenses, especially for emerging districts and undeveloped precincts like the Marina South district.
Marina South MRT station is directly next to Marina Gardens Crescent. It can be built up to an area of nearly 783,00 sq ft. That’s about 6% more than what was stipulated in the contract for Kingsford.
URA has launched the Marina Gardens Crescent site for tender sale in June 2023 as per the confirmed list of H1 GLS 2023. The site will be placed on a reserve list in the H1-2024 schedule, which allows interested parties to apply for the sale of this site at a minimal price acceptable to government.
The sale of sites that are on the confirmed list will be done according to schedule and regardless of demand. Sites that are on the reserved list will only be released after an application is approved by a developer, who has agreed to bid a price minimum that the government accepts at the tender.
Marina Gardens Crescent might not be activated as soon as expected, given the increased supply of homes to be built in the near future.
Skywaters Residences in the city and Newport Residences remain unlaunched. It is possible that the abundance of housing sites could be a factor in developers’ lack of confidence.
It will be fascinating to see if, when the site comes back up for tendering, the government gives it away. This is especially true if more than three bids were submitted, or if they came in at S$984.00 psf.
The new benchmark could be set by developers who assess that foreign buyers are less likely to buy homes due to the increased Additional Buyers’ Stamp Duty of 60%.