The Bid For The Marina Gardens Crescent Site Submitted By GuocoLand Is Too Low
THE Urban Redevelopment Authority (URA) has rejected the S$770.46 million bid or S$984 psf ppr for the 99-year leasehold Marina Gardens Crescent site, assessing the bid price to be too low. This is the first rejection for a state land tender since 2011.
The sole bid was submitted by a consortium comprising GuocoLand, Hong Leong Holdings and TID (a joint venture between Hong Leong Holdings and Japanese developer Mitsui Fudosan) for a government land sale (GLS) site at Marina Gardens Crescent.
The site, launched for sale under the confirmed list of the Government Land Sales (GLS) Programme for the first half of 2023, will now be made available on the reserve list of the H1 2024 GLS Programme. Developers can submit applications for the sale of the site, with a minimum price that is acceptable to the government.
Located next to Marina South MRT station, the Marina Gardens Crescent plot can be used for residential and commercial development. It has a maximum gross floor area of nearly 783,000 square feet, and can generate about 775 private homes.
The tender of the Marina Gardens Crescent site is the second land parcel for sale in the Marina Gardens area. The first site, at Marina Gardens Lane, was awarded to a Kingsford Group-led consortium last June. Kingsford Group paid a land rate of S$1,402 psf ppr for a neighbouring plot in Marina Gardens Lane, in a state tender which closed last June. The land rate was 40% higher than the second-highest bid, which came from a joint venture between GuocoLand and Hong Leong Group who submitted a bid of S$727.04 million, or S$985 psf ppr.
At the tender for the first GLS, Marina Gardens Lane site, the second and third-highest bidders submitted bids that worked out on a psf ppr basis to S$985 and S$953 respectively. Thus, the most bullish bid out of the four bids received was from Kingsford.
The Market Was Skeptical The Marina Gardens Crescent Site Would Be Awarded
This is the second state tender in the Marina Gardens area that GuocoLand had partook in and the developer had submitted a similar psf ppr bid price for the first and second tenders.
GuocoLand may have wanted to test waters as it would have expected that there will be lukewarm interest for the second Marina Gardens site since the first site had only received four bids and it came in at the second highest
Assuming the Kingsford’s winning land rate of S$1,402 psf ppr is used as a benchmark, we may not see renewed interest in the Marina Gardens Crescent land sales site as the price differential is 40%.
However if the government does receive multiple sales applications with tighter bid-spreads, it could signal to them that Kingsford’s bid was surely an outlier and should not be viewed as an accurate fair market value.
(Source: The Business Times, EdgeProp)
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