Developers to remain prudent in bidding for Margaret Drive, Media Circle: analysts

The sites can yield 460 condos and 520 long-stay serviced apartments, respectively.

Developers are likely to be conservative with their bids on the newly released residential sites at Margaret Drive and Media Circle, according to property analysts. 

Wong Siew Ying, research and content head of PropNex estimated the Margaret Drive site, which could yield 460 new homes when developed, to attract two to three bids with a top bid of $474m to $517m, or $1,100 to $1,200 psf ppr.

While she expects developers to observe vigilance and prudence in government land tenders, Wong said Margaret Drive will still garner strong attention due to its location near the Queenstown MRT and the lack of new projects in the area.

Justin Quek, CEO of OrangeTee & Tie, shared the same view, noting that there is currently a pent-up demand from homebuyers already residing in the area but want to upgrade their homes. Quek estimated up to five bids with the highest bid ranging from $1,200 to $1,300 psf ppr. 

In a separate commentary, Ngiam Juyong, Project Director at Huttons Asia said the plot may see three bidders at most and a top bid of $1,150 to $1,250 psf ppr.

Media Circle

The Media Circle plot, meanwhile, could see a more lukewarm result as the plot, with all 520 units allotted for long-stay serviced apartments, limits the type of developers that can undertake hospitality projects.

“The residential leasing prospects in the area could be positive, in view of the multitude of companies located in the one-north precinct and the nearby Science Park, as well as faculty members, international students and staff at the NUS and NUH, not far from the plot,” said Wong. “One downside perhaps, is that the site is not particularly near to an MRT station.”
 
Juyong of Huttons expects the site to have only one offer with an estimated bid of less than $1,100 psf ppr, noting that the project requires a longer period to recoup the capital. 

PropNex’s Wong sees the site drawing one to two bids of up to $261m while Quek of OrangeTee estimated two to three bids ranging from S$1,000 to S$1,100 psf ppr. 

“There are not many serviced apartments or major co-living spaces in the vicinity. This future project may hence be able to effectively cater to the needs of workers or students who desire to live in this area, rather than having to accommodate multiple groups such as families, workers, and student renters simultaneously,” said Quek from OrangeTee.

The Urban Redevelopment Authority (URA) is accepting bids for Margaret Drive until 1 August, whilst the tender for Media Circle will close on 19 September.