Public residential land tenders snubbed by picky developers in Q3

The average number of participating developers plummeted.

Government residential land sales were snubbed by policy-battered property developers in Q3. According to Colliers, the average number of developers who participated in public residential land tenders plummeted to 4.7 in 3Q 2014 from 8.6 and 6.3 recorded in 1Q and 2Q 2014, respectively.

There were four sites sold in 3Q, most of which commanded lower values as they were generally sited at more outlying locations than those awarded in the previous quarter. 

“Location aside, developers have also demonstrated an increasing level of selectiveness and guardedness in their bids - a sign that the confluence of multiple cooling measures and the Total Debt Servicing Ratio (TDSR) framework that have been impeding the private collective land sales market is starting to take its toll on the public residential land sales segment,” stated Colliers.

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In particular, an Executive Condominium (EC) land parcel located on Sembawang Avenue attracted only four bids when its tender closed in July 2014. 

The winning bid of $320 per sq ft per plot ratio, submitted by a tie-up between units of Frasers Centrepoint and Keong Hong Holdings, reflects an 8.5% discount from the tender price paid for another EC site located nearby on Canberra Drive in January 2014. 

Subsequently in August 2014, two adjacent plots on Fernvale Road designated for condominium development, also drew subdued responses from three and four contenders at each tender closing.