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State tender for Holland Road site draws 15 bids

A STATE tender for a plum 99-year leasehold commercial and residential site in Holland Road closed on Tuesday, attracting a whopping 15 bids.

Some developers placed more than one bid with different concept proposals for the site - to boost their chances of clinching the site.

Under the dual-envelope concept and price tender mode for the site's sale, the Urban Redevelopment Authority (URA), which conducted the tender, has released only the names of the bidders but not their bid prices.

A consortium comprising Far East Organization, an affiliated company and Sekisui House submitted three bids.

Three consortiums placed two bids each: Lendlease in a tie-up with Pontiac Land; Perennial Real Estate Holdings in partnership with Qingjian Realty; and GuocoLand in partnership with Hong Leong Holdings' fully-owned unit Intrepid Investments, TID and Hong Realty.

The rest of the bidders placed one bid each.

They include City Developments, in partnership with RB Capital; Allgreen Properties in partnership with Kerry Properties; and UOL Group, which teamed up with United Industrial Corporation.

Also bidding were CapitaLand, in partnership with Hotel Properties; SingHaiyi Group in a tie-up with its controlling shareholder Haiyi Holdings; and Chip Eng Seng in partnership with Roxy-Pacific Holdings and JBE Properties.

Bidders were required to submit their concept proposals and tender prices in two separate envelopes. Under this system, only the envelopes containing concept proposals were opened on Tuesday.

The concept proposals should demonstrate how the proposed development on the land parcel will address the following evaluation criteria: quality of design concept, quality of public realm, and track record.

A Concept Evaluation Committee (CEC) will first evaluate the concept proposals against the evaluation criteria. Only those that substantially satisfy the evaluation criteria will be shortlisted by the CEC for the second stage of the tender evaluation.

At the second stage, the price envelopes of proposals with acceptable concepts will be opened for consideration. The site will then be awarded to the tenderer with the highest bid.

The Holland Road site can have a maximum gross floor area (GFA) of 59,715 square metres (642,766 sq ft), of which up to 13,500 sq m can be used for retail. The URA has also set a cap of 570 residential units for the project.

At least 60 per cent of the total GFA should be for residential use and the remaining 40 per cent may be for commercial use.

The land parcel is divided into two zones.

Zone 1 is intended for residential development. The types of housing units that can be allowed in this zone are flats, serviced apartments and/or strata landed houses.

Zone 2 is intended for commercial and/or serviced apartment uses. To create a vibrant "live, work and play" setting, dual "office/residential" use units - whereby each unit is allowed to be used for both office and/or residential uses interchangeably without planning permission - may be allowed as part of this zone subject to compliance with government requirements.

No strata subdivision is allowed in Zone 2.

The plot is the first Government Land Sales site launched as part of the Holland Village Extension plan unveiled in URA's 2014 Master Plan .

Market watchers expect that all in, it could take about two months before URA awards the site.

The successful bidder will be given seven years to complete the project.

JLL national director Ong Teck Hui said that the response to the tender was not unexpected given the attractiveness of the site, the upturn in the residential and commercial property sectors and the stabilising retail property segment.

"As expected, many major players submitted bids with a number of them as consortiums. The huge capital outlay with a land price possibly exceeding S$1 billion and the necessary experience in developing and managing the non-residential component would have led to the tie-ups."

CBRE Research head of Singapore and South East Asia Desmond Sim said: "As it is a mixed development as well as a GLS site, the tender presents greater opportunities and a quicker, clean-cut acquisition process for developers compared with participating in a collective sale."

ZACD Group executive director Nicholas Mak noted that at least two China-originated developers participated in this tender - Qingjian and Singhaiyi. "These developers were primarily developing residential projects in Singapore. Now they appear to be ready to expand into commercial development and possibly hold such commercial developments for investment. This could be the next step in the evolution of their business strategy. They will be giving other Singaporean developers a run for their money."

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