Two large development sites in Upper Serangoon and Queenstown – able to yield 1,000 homes in all – were released by the Government on 25 September 2014.
A mixed residential-commercial plot in Upper Serangoon has been put up for tender as part of the confirmed list of the Government Land Sales (GLS) programme for the second half of this year.
The Queenstown residential plot in Dundee Road has been made available on the reserve list, which means it will not go to tender unless a developer submits a bid acceptable to the Government.
Experts expect stronger response from developers for the Upper Serangoon site. The roughly 10,000 sq m, 99-year leasehold site can be developed into a 340-unit project, with commercial units on the first storey.
It is in an area with “abundant amenities” – with Kovan City and Heartland Mall, as well as Serangoon Junior College and Kovan MRT station, nearby, said Mr Ong Teck Hui, national director of research and consultancy at Jones Lang LaSalle.
“The ability to have commercial units on the first storey will be an added attraction, although the strata retail market has also been slowing.”
The Upper Serangoon site is smaller than the commercial and residential zoned site in Meyappa Chettair Road, also in the Serangoon area, which was the subject of a 15-bid tender that concluded last month.
“The quantum size may therefore be more digestible to developers,” said Mr Steven Tan, managing director of OrangeTee.
But potential bidders will have to be mindful that the development at the Meyappa Chettair site could be launched about the same time as this one, competing for the same group of buyers, said Mr Nicholas Mak, executive director of research and consultancy at SLP International Property Consultants.
Mr Mak added that the triangular shape of the 99-year leasehold site could make it challenging to develop, as is the fact that it fronts two busy roads, Upper Serangoon Road and Tampines Road.
Experts expect about 10 bidders for the site, with a winning bid of between $650 and $750 per sq ft per plot ratio.
But they are uncertain if interest in the 10,500 sq m Queenstown site, able to yield 645 units, will be strong enough to trigger a tender.
Mr Tan said sufficient short-term supply from new launches in the vicinity – including Alexandra and Tiong Bahru – means that it is unlikely developers will be immediately interested.
Apart from the challenging residential market, nearby Commonwealth Towers has more than 500 units unsold, experts noted.
“The demand in the mid-tier property market has softened, compared with a year ago. This may deter developers from triggering the tender of this site,” said Mr Mak.