Selling prices of Pine Grove and Dunman Road may range from $2,200 to $2,400 psf

Top bids for the two sites were $1,318 psf ppr and $1,350 psf ppr, respectively.

Property experts expect Pine Grove (Parcel A) and Dunman Road to have future selling prices ranging from $2,200 to $2,400 psf after the two GLS sites received heath demand from their bidding exercise.

The tender for both sites closed on 2 June.

Data from Huttons and Colliers showed that Pine Grove's (Parcel A) attracted five bidders with a top bid of $1,318 psf ppr or $671,500,800. 

The top bid translates to an expected selling price of between $2,300 and $2,400 psf when the project is launched, said OrangeTee.

The five bids, however, were still lower than the average of seven bids received for tenders closed this year, Colliers said.

"This could be attributed to the planning restriction of 520 units to manage traffic flow, which might impose some planning inflexibility for the developer," Colliers added.

According to PropNex, the bidding for Parcel A was tight, with the top bid from United Ventures Development, a subsidiary of UOL Group, only having a gap of $800 from the second bidder, Pine II Residential Pte. Ltd.

This was echoed by Huttons, saying: "This has to be the closest fight in GLS tenders ever. The close bids reflect the need from developers to quickly replenish their landbank with attractive sites, especially in an area where there has not been a launch in more than ten years."

Given the top bid, CBRE expects a launch price of $2,200-$2,300 psf for Parcel A. PropNex, meanwhile, had a higher estimate saying prices may start from $2,400 psf.

Dunman Road

Compared to Parcel A, Dunman Road had fewer bids, attracting two developers, which CBRE said was lower than expected. On the other hand, its highest bid price of $1,350 psf ppr was in line with expectations, the property expert added.

Property experts said the lower number of bids can be attributed to several reasons.

OrangeTee cited "large price quantum and risks involved," as a possible reason.

This  was echoed by Edmund Tie and Huttons, with the latter saying developers are "concerned about increased risks emanating from cooling measures and geopolitical uncertainties."

Edmund Tie, for its part, said:  the associated development risk of incurring punitive ABSD taxes and accrued interest should the project not sell out within five years.

"The mounting economic headwinds is another chief factor for the muted response for the site," Edmund Tie added.

Given its top bids, OrangeTee expects the future selling price of this project to be between $2,300 and $2,400 psf. Colliers, meanwhile, had a lower estimate of $2,200-$2,300 psf.

Meanwhile, Colliers said the two bidders might have been encouraged by the sales at nearby Liv@MB, where over 74% were sold at a median unit price of $2,400 psf.

Healthy demand = confidence in the market

Overall, experts believe that the health demand for both GLS sites reflects developers' confidence in Singapore's real estate market even after post-cooling measures.

"The batched bidding exercise did not seem to have dampened developers’ appetite for residential land; with some developers even going for both plots even though they are both relatively larger sites," Colliers said.

PropNex, for its part, said: "The strength of the top bid for the two sites suggests that developers remain confident of the market outlook and housing demand, encouraged by healthy home sales and as the stock of unsold new private homes hit a record low."