The Urban Redevelopment Authority (URA) of Singapore recently put up a residential site in Orchard Boulevard for sale, attracting attention from market observers. The soft market sentiment is expected to make developers cautious and restrained in their bids for the property. While most analysts believe the top bid will fall in the range of S$1,378 to S$1,800 per square foot per plot ratio (psf ppr), opinions vary on the number of potential bidders, with estimates ranging from one to three bidders to as many as five to ten.
This 99-year site spans 7,031.5 square meters and is zoned for residential use with a commercial element on the first floor, offering a maximum gross floor area of 24,611 square meters. It’s the first site released in the Orchard area since May 2018, conveniently located near the Orchard Boulevard MRT station, embassies, and amenities such as Tanglin Mall, Gleneagles Hospital, and Camden Medical Centre. URA expects it to house around 280 units, contributing to the 5,160 residential units in the H2 2023 GLS program.
Property analysts anticipate that developers will consider the April cooling measures, particularly the increased ABSD duty for foreign buyers, which has been doubled to 60%. As a result, developers are likely to target local buyers for this project. ERA’s Eugene Lim stated that if the price and size align with local preferences, the project could be well-received. However, local buyers may have different preferences in terms of unit mix and tend to be more price-conscious compared to foreign buyers and investors.
Developers interested in prime locations without going through an en bloc sale might find this site appealing, according to Justin Quek, Deputy Chief Executive of OrangeTee & Tie. The small plot size and the number of units make the price quantum more manageable for developers.
Notably, unlike mass-market projects, luxury new home developments often take longer to sell, as developers prefer to wait for high-net-worth buyers. This suggests that buying property now may be more favorable than waiting for luxury projects, as developers tend to hold out for high-net-worth buyers.