Robert Kuok’s Allgreen Enters Top Bid of $544M for Central Singapore Site

The Singapore government on Thursday closed tenders for three residential development sites, with a closely watched parcel near Havelock MRT station drawing a top bid of S$730 million ($544.4 million) from billionaire Robert Kuok’s Allgreen Properties.

Known as Zion Road (Parcel B), the site in posh District 10 had been triggered for tender in April when a mystery bidder offered S$605 million for the right to develop the plot from the Government Land Sales reserve list into a 610-home project.

Allgreen, part of the Kuok Group headed by Malaysia’s richest man, prevailed in the expanded exercise with a bid equal to S$1,304 per square foot for the project’s maximum gross floor area of 559,745 square feet (52,002 square metres). The only other bid for the site, submitted by units of Kwek Leng Beng’s Hong Leong Investment Holdings, came in at a far lower S$660.8 million or S$1,181 per square foot.

The tender was triggered less than a week after a joint venture of City Developments Ltd and Japan’s Mitsui Fudosan won the adjacent Parcel A, giving rise to speculation that the partners were likely suitors for Parcel B. As it turned out, CDL chairman Kwek’s private holding firm made an attempt but fell short.

“The tepid interest in the site can be attributed to concerns about the potential competing supply of new private residential units that will be generated from recently awarded GLS sites in the locale,” said Chia Siew Chuin, head of residential research at JLL Singapore.

Decisions to Come

A decision on awarding the Zion Road tender, as well as those for the two other sites at Canberra Crescent and De Souza Avenue, will be announced at a later date, the Urban Redevelopment Authority said in a release.

The Canberra Crescent site, which can yield 375 homes in the Sembawang Square Estate of the country’s far northern reaches, drew three bids, including a top offer of S$279 million from a tie-up of Low Keng Huat and Kheng Leong, a private firm owned by the Wee family that controls UOL Group.

Amounting to S$793 per square foot of accommodation, the bid is conservative in light of current market conditions, according to JLL’s Chia, but still 23.1 percent and 21.9 percent higher than the top offers attained by nearby Canberra Drive Parcels A and B, respectively, in March 2020.

For the De Souza Avenue site in Upper Bukit Timah, the highest bid of S$278.9 million (S$841 per square foot) was entered by local builder Sustained Land. The lower-than-expected offer for the site, which can yield 355 homes, may have reflected a requirement to reposition the pedestrian crossing on Jalan Jurong Kechil, create new bike lanes and walkways along Old Jurong Road and Jalan Jurong Kechil, and expand a pedestrian crossing at the intersection, Chia said.

“While lower land prices may seem to suggest reduced selling prices for future launches, developers must contend with various factors such as development costs, risks and lower profit margins,” she said. “As a result, the pricing of newly launched units will remain aligned with the prevailing market prices at the time of their release.”

Casting a Wide Net

Allgreen’s bid for the Zion Road plot follows the company’s March purchase of the Seletar Mall in northeastern Singapore for S$550 million ($410 million).

After completing the acquisition, Allgreen said it was looking at making enhancements to the 2014-vintage mall, including aiming for an unspecified certification under Singapore’s Green Mark regime for sustainable buildings.

The company added the retail property in the Fernvale area to a portfolio that already includes the Great World complex and the Tanglin Mall in the Orchard area, as it readies the launch of its Pasir Ris Mall project on the upper east coast.