The River Valley Green site attracted a pair of suitors
A luxury residential site in Singapore’s posh River Valley area drew two bids in a tender that closed Wednesday, including the top offer of just under S$464 million ($343.6 million) from developer Wing Tai Holdings, according to an announcement by the Urban Redevelopment Authority.
Wing Tai’s bid for River Valley Green (Parcel A) equates to S$1,325 per square foot of built area, in line with Huttons Asia’s expectations of S$1,200 to S$1,400, the consultancy said in a release. Kwek Leng Beng’s Hong Leong Investment Holdings entered the lower bid of nearly S$444.9 million for the 99-year freehold plot, which can yield 380 homes.
The low participation from developers reflected market uncertainty, the additional buyer’s stamp duty of 60 percent on foreigners and concerns about future sales rates, said Huttons Asia CEO Mark Yip.
“This site is attractive as it has direct access to Great World MRT station,” Yip said. “Amenities are aplenty in the area from Great World City mall to Zion Riverside food centre. The popular River Valley Primary School is within walking distance.”
Upper Thomson Flop
The other tender closing Wednesday, for Upper Thomson Road (Parcel A), ended with no bids, the URA said. The plot in Singapore’s northern region can yield 640 units, including a required 100 long-stay apartments for rent.
Wing Tai Holdings chairman Cheng Wai Keung
Despite the location next to Springleaf MRT station, developers may have passed on the plot due to the LSA mandate and the site’s remoteness from major commercial hubs, according to local broker PropNex Realty.
“We reckon the government could potentially inject this plot to the upcoming GLS slate for 2H 2024, perhaps reviewing the LSA component in the process,” said Wong Siew Ying, head of research and content at PropNex.
In April, the URA awarded the neighbouring Upper Thomson Road (Parcel B) to a joint venture of Malaysia’s GuocoLand and Kwek Leng Beng’s Hong Leong Holdings for S$779.6 million. While the offer had been the sole bid for the plot, which can yield 940 units, some industry experts had speculated that the URA might withdraw the tender after the price came in below expectations.
Supply Logjam
The abundance of competing supply from Upper Thomson Road (Parcel B) and six upcoming projects in the nearby Lentor area was likely a deterrent to potential bidders for Parcel A, said Chia Siew Chuin, head of residential research at JLL Singapore.
“Developers may also be tentative due to the relatively quieter location,” Chia said, “and the absence of comprehensive amenities and schools in the neighbourhood may also represent a risk.”
The inclusion of the LSA component requires niche expertise to develop and operate serviced apartments and higher upfront capital spending, she said. A mandate to incorporate biodiversity-sensitive designs and environmental safeguards due to the site’s proximity to the catchment area could also increase overall outlay.
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