GuocoLand Hong Leong cement their control over the area by securing Upper Thomson site
The consortium’s participation at the tender is probably driven by a defensive strategy, which aims to maintain its strong foothold on the region beyond the Lentor area. The consortium can then better manage pricing and sales of their project. GuocoLand develops 2,211 homes in the Lentor District, even if this particular site is excluded.
Around 1,200 unsold units are available in various projects of the new Lentor Hills development, where six plots had been sold and five projects were launched.
Also, a second location on Upper Thomson Road is on the table. Parcel A is an adjacent state-owned land plot currently on the market. It can produce 640 housing units, 100 of which are long-stay serviced apartment.
Analysts predict that Upper Thomson’s (Parcel B), which was bid at S$905/sf/ppr, will be priced between S$2,000 and S$2,200/sf.
If the launch price of this project is palatable it may appeal to local buyers looking to downgrade their landed houses in the Springleaf neighbourhood, as well HDB upgraders who come from the Ang Mo Kio, Yio Chu Kang and Yio Chu Kang Estates.
The Upper Thomson Road, Parcel B plot is 32,023.7 Square metres (sq. m.) in size and can accommodate 940 homes.
The Essence condominium, with a 99-year tenure in Chong Kuo Road near by, was opened in March 2019. The Essence is currently selling at a S$1,376 median price per square foot. The site was acquired in 2018 and awarded for S$43.95M or S$681psf ppr.
In January, a subsale was conducted for a unit of 818 square feet at S$1.3million or S$1,638/sqft.
The highest bid, S$780M (S$905 psf per plot per year) was a bit below the expectations. It is also 8 percent less than what most recently purchased Lentor plot sold for.
The Upper Thomson area has seen the latest state auction close. Developers are avoiding the land market due to caution.
The site attracted just one bidder: a joint-venture between GuocoLand Holdings (Hong Leong) and GuocoLand, which offered S$780,000,000 ($904.60 per sq. foot per plot rate).
Business Times polled before the bid closed on Thursday (Apr 4) and found that only one offer came in at a price just above what they had expected. Consultants expected that three to five bids would be received, with the top bid between S$1,000 and S$1,100/sf ppr.
The land rate for Lentor Central was also 8 percent lower. This site was sold in September 2023 by a joint venture of Hong Leong Holdings Ltd, GuocoLand Limited and China Construction Development Co (South Pacific). The cost for the project is S$435.2M or S$982psfppr.
Some players may have been deterred by site-specific conditions, but winning an Upper Thomson plot will give them an advantage in a growing area which is predominantly a precinct for landed housing.
