Analysts weigh in on the underwhelming bidding at Marina Gardens Crescent

A white site in Marina South fetched a lower bid land rate than a plot in one-north.

Developers remained cautious with their offers during the two government land sales that concluded on Thursday, but property analysts were quick to point out how the Media Circle site garnered more interest than a plot in downtown Singapore.

“Bidding interest among developers continues to be cautious, following on from what we witnessed in 2023. In somewhat of a highly surprising twist, the Marina Gardens Crescent white site, in downtown Singapore fetched a top bid land rate that is lower than that of the Media Circle site,” said Wong Siew Ying, Head of Research and Content, PropNex Realty. 

The $770.5m sole bid for the Marina Gardens Crescent by the consortium of GuocoLand, Hong Leong’s Intrepid Investments and TID Residential, works out to $984 per square foot per plot ratio. 

That price was 30% lower than the $1,402 psf ppr offered by a joint venture between CNQC Realty and Forsea Residence for the Media Circle site, for a total of $395.3m. 

READ MORE: Marina Gardens Crescent site attracts one bid; Media Circle receives 3

CBRE noted that the top bid for Marina Gardens Crescent was also 24% below its initial estimates, likely due to developers’ general risk aversion to “large and investor-focused sites” in the city-state amid a challenging macroeconomic environment.

“This is indicative of deteriorating developer sentiment for city sites which require larger capital outlay and face uncertain end-user demand post-Apr 2023 cooling measures,” said Tricia Song, CBRE Head of Research, Singapore and Southeast Asia.

Song said planned city project launches have also been deferred recently due to the ongoing uncertainties in the market.

Meanwhile, Lee Sze Teck, Senior Director for Data Analytics at Huttons Asia said the stronger-than-expected results at the Media Circle site tender signals developers’ confidence in the demand for new homes in one-north and its tight supply situation.

“There will be no new supply of homes for sale in the next year as the other Media Circle site is for long stay serviced apartments. Rents for homes in one-north have been strong due to the larger pool of expats,” he added.

CBRE expects future condos at the Marina Garden Crescent site to range around $2,000 to $2,100 psf, PropNex expects selling prices to still breach the S$2,500 psf mark.

For Media Circle, new homes to be built on the site could sell for $2,350 to $2,400 psf according to the two agencies.