Developers are likely to show a moderate level of interest in what could be the only executive condominium (EC) site available this year.
The 226,199 sq ft Anchorvale Lane plot, which can support about 635 units, was released for sale yesterday. It is the only EC site on the confirmed list for the Government Land Sales (GLS) programme this year. Recent executive condo launches include Treasure Crest and Northwave while existing ones include The Terrace EC, Brownstone EC, The Visionaire, Parc Life , Waterwoods EC, Signature at Yishun, Skypark Residences, Wandervale EC, The Vales, The Criterion EC, The Amore EC, Bellewaters EC, Bellewoods EC.
The tender closes on Aug 23.
Developers will probably show some appetite for the land, which is near Tongkang LRT station, despite the large number of unsold EC units in the market, including many in the area surrounding the site.
“They could probably bid at lower prices than previously transacted in the area, which would give them an advantage when launching the product,” said Dr Lee Nai Jia, DTZ regional head of research for South- east Asia.
Land prices have fallen slightly in some areas where multiple parcels were launched.
MCC Land paid about $482.59 per sq ft per plot ratio for a Tampines Avenue 10 site last year that was labelled as Parcel D. This was 14 per cent less than what it paid for nearby Parcel B in July 2013.
“Some developers also need to replenish their land banks. However, there will be challenges in terms of differentiating the EC from other new HDB projects and condos in the area,” Dr Lee added.
And developers will certainly bear in the mind the strong supply of EC units.
As at the end of May, there were 3,705 launched and unsold units and a further 1,925 apartments in four new and unlaunched EC projects, said Mr Nicholas Mak, executive director and head of research and consultancy at SLP International.
“Based on average buying demand for EC units, it would take about 2½ years to absorb the current supply of EC units.”
The larger nature of the Anchorvale Lane site could dissuade some developers, said Mr Ong Kah Seng,
Given this is likely the only EC plot up for sale for this year, the Government is likely to watch participation closely, said Mr Mak. “This will in turn influence the number of EC sites to be released in the GLS programme next year.”