Tenders closing for URA sale sites at Champions Way and Lentor Central

^{Source: URA, JLL Research}

The bid price put in by the joint venture (JV) between Guocoland, Hong Leong Group and CSC Land Group topped the two bids received for the Lentor Central site. Its offer of $982 psf ppr surpasses the next highest bid of $927 psf ppr by 5.9%.

With this bid, GuocoLand and Hong Leong Group, who had also partnered earlier, and have stakes in three of the five Lentor sites previously tendered, will secure an even stronger foothold in the locale. This will enable them to better manage competition.

The top bid of $982 psf ppr for the subject site, the sixth GLS site tendered in Lentor since 2021, is also the lowest psf ppr land price recorded compared to the range of $985 to $1,204 psf ppr achieved by the previous five plots. The last site at Lentor Gardens was awarded to the JV between GuocoLand and Hong Leong Holdings at a marginally (0.3%) higher land price of $985 ppr in April 2023.

The lukewarm tender participation and conservative price bids reflect the cautious market sentiment and reduced risk appetite of developers amid a potential supply glut in the Lentor locale and heightened market risks.

In addition to the large pipeline supply of more than 3,000 private in the vicinity, several factors also subdued interest in the site. These include high development costs, modifications to the gross floor area definition, which reduces the amount of sellable space and potential profits for developers, as well as the recent market cooling measures. The dominance GuocoLand and Hong Leong Group in the area has also likely steered some developers away.

The selling price for the new project is anticipated to be in the range of $1,950 psf to $2,050 psf.