SINGAPORE - A prime 99-year leasehold site in Holland Drive that can yield about 680 units has been released for sale under the confirmed list for the first-half 2024 Government Land Sales (GLS) programme.
The Holland Drive site is the first GLS site to be launched in the Holland Village area since the award in May 2018 of a nearby Holland Road site, where the mixed-development One Holland Village now sits.
Back then, the tender for the Holland Road site attracted 15 bids and was awarded at $1.21 billion, or a land rate of $1,888 per sq ft per plot ratio (psf ppr). Following its launch in November 2019, all 296 units at One Holland Village Residences were sold by August 2023 at an average price of $2,807 psf.
With its attractive location and proximity to Holland Village MRT station and commercial amenities in Holland Village, the Holland Drive site, which is bound by North Buona Vista Road, Holland Drive and Holland Road, has a maximum gross floor area of more than 626,000 sq ft, and should likewise command a potential land price quantum of up to $1 billion, analysts say.
But this could suppress developers’ interest, especially in the face of still-high interest rates, macroeconomic uncertainty and slowing new home sales in the prime district following the latest round of property cooling measures, which doubled additional buyer’s stamp duty rates for foreigners to 60 per cent.
“The site has many positive attributes, but the land price could be a deterrent,” said Ms Wong Siew Ying, head of research and content at real estate firm PropNex.
Based on their muted participation in recent GLS tender exercises, developers appear to be still cautious about large investor-focused sites, said Ms Tricia Song, CBRE’s head of research for Singapore and South-east Asia.
For instance, a Lorong 1 Toa Payoh site with 775 buildable units – located in an area that has not seen a new condo launch in seven years – received just three bids in November 2023, given the larger total gross floor area and higher price quantum, analysts said. It was awarded to a joint venture between City Developments Limited, Frasers Property and Sekisui House, which tabled the top bid of $968 million or $1,360 psf ppr.
A plum residential-cum-commercial site in Orchard Boulevard – the first GLS site made available in the Orchard area since a Cuscaden Road site was awarded in May 2018 – attracted four bids earlier in February 2024. It was awarded to UOL Group and Singapore Land Group, which jointly submitted the top bid of $428.3 million or $1,617 psf ppr.
Most analysts say the top bid for the site, which can yield 280 units and about 500 sq m of commercial space, was below expectations. The top bid was 32 per cent below the record price of $2,377 psf ppr set by the nearby Cuscaden Road site (now Cuscaden Reserve) in 2018, they said.
Expectations are for the Holland Drive site to garner between two and five bids, with developers likely to form consortiums to mitigate the development risk. Top bids are expected to range between $846 million and $1 billion, or a land rate of $1,350 to $1,600 psf ppr.
Mr Lee Sze Teck, Huttons Asia’s senior director of data analytics, noted that this is the last plot of land for private residential development in the Holland Village enclave, and that the new project could exceed 30 storeys.
Existing projects in the vicinity such as Van Holland are sold out, and projects in the nearby one-north area saw good take-up rates during their launches. With a lack of new supply, the future project at the Holland Drive site may see healthy demand, said Mr Justin Quek, OrangeTee & Tie’s chief executive.
The Holland Drive site forms part of 5,450 residential units to be made available via the confirmed list of the first-half 2024 GLS programme.
The tender for the site will close at noon on May 14.
