By Linette Lim | Posted: 01 September 2011 2159 hrs

SINGAPORE

The tender for a 99-year lease site at Punggol Field Walk attracted a top bid of S$169.56 million at the close of tender on Thursday.

The 154,397-square feet site attracted a total of eight bids, with Capital Development/ZACD Investments submitting the highest bid.

The other seven bids came from FCL Topaz, Far East Civil Engineering & Sekisui House, Leng Hoe Development, Allgreen Properties, EL Development, Heeton Capital, Intrepid Investments and Wee Hur Development.

“The cautious bidding is expected, but eight bidders for a mediocre suburban site like this is better than the usual participation,” said Ong Teck Hui, head of research & consultancy at Credo Real Estate.

He added: “This shows that many developers are still confident of the suburban market in spite of the HDB income ceiling being revised upwards to S$10,000 and potentially affecting the private housing market.”

Based on the tender prices, analysts said the future pricing of suburban condominiums are consolidating.

Li Hiaw Ho, executive director of CB Richard Ellis, said: “The top bid of S$169.56 million or S$323 per square foot per plot ratio reflects a breakeven cost of about S$700 per square feet.

“For comparison, the site of a condominium project at Punggol Way/Punggol Central was sold at S$406 per square foot per plot ratio in February 2011.”

Mr Li also noted that currently, units in RiverParc Residence EC are selling at a median price of S$695 psf. “It is likely that units in this new condominium will be priced at above S$800 psf,” he added.

Zoned for condominium housing, the land has a maximum permissible gross floor area of nearly 525,000 square feet, potentially yielding an estimated 550 dwelling units.

URA says it will make a decision on the tender award after evaluating the bids and will announce this at a later date.

– CNA/al