URA releases two land parcels at one-north's Slim Barracks Rise for sale

TWO residential with commercial at first storey land sites at Slim Barracks Rise were released for sale on Tuesday, under the confirmed list of the first half 2021 government land sales (GLS) programme, announced the Urban Redevelopment Authority (URA).

Nicholas Mak, head of the research and consultancy department at ERA Singapore, estimates that the land parcels could each draw an estimated top bid of between S$1,080 and S$1,180 per square foot per plot ratio (psf ppr), with possibly 10 to 15 bids when the tenders close at noon on Sept 28, 2021.

The land plots are relatively small compared to other GLS sites, he said, which would attract small and medium-size developers, resulting in a higher number of bids. Mr Mak noted that small sites are among the minority in the GLS programme.

Lee Sze Teck, director of research at Huttons Asia, agreed that the sites' "palatable size" will attract around 10 developers to bid for the land parcels, but at an estimated price range of between S$1,200 and S$1,300 psf ppr.

He added that Slim Barracks Rise (Parcel A), with a regular plot size and closer location to Buona Vista MRT station, would be the more attractive of the two land plots, though both are appealing for their ideal location in the one-north precinct, very close to the future One Holland Village.

"The bunching of two sites in the same area for sale is probably to temper land bids by developers," Mr Lee said.

A NEWSLETTER FOR YOU

Tuesday, 12 pm

Property Insights

Get an exclusive analysis of real estate and property news in Singapore and beyond.

Sign Up

Sign Up

Wong Xian Yang, head of research, Singapore, at Cushman & Wakefield, said given the small sizes of both sites and same closing tender dates, a developer could bid to win both sites to mitigate future competition and achieve higher economies of scale.

Together, the two land parcels can potentially yield a total of about 405 residential units. Slim Barracks Rise (Parcel A) spans 7,957.3 square metres (sq m) with a maximum gross floor area of 23,872 sq m; Slim Barracks Rise (Parcel B) possesses a site area of 5,936.6 sq m and a maximum gross floor area of 12,467 sq m.

Mr Mak said, based on his bid price estimates: "This would translate to S$277.5 million to S$303.2 million for Slim Barracks Rise (Parcel A), and S$145 million to S$158.3 million for Slim Barracks Rise (Parcel B)."

He believes that the commercial space on the ground floor will enhance the value of the development, as it usually commands higher prices than residential space on the same floor.

All the commercial space in each development must be held under a single strata lot, which would not allow for sub-division for separate sales of several small retail lots.

However, this would not diminish the attractiveness of these two sites among developers, Mr Mak said. Rather, it will raise the chances that the commercial space in each development will be better designed and managed under single ownership.

"If both sites were developed by different developers, the competition may even draw out the innovative retail mix in the commercial space of each development which would ultimately benefit the consumers," he added.

Mr Lee believes that as both plots of land are not next to each other, it will prevent the situation of one developer securing both plots and achieving economies of scale and monopoly in the area.

The URA said in its announcement that the sales launch is part of JTC Corporation's continued efforts to inject more residential spaces in the one-north estate.

JTC seeks to meet housing needs and enhance the area as a mixed-use business park that serves as a fertile ground for research, innovation and entrepreneurship.

The tender for an earlier residential site at Slim Barracks Rise closed in September 2019 after it drew nine bids, Mr Mak recalls. The site was developed into one-north Eden, whose units command a median transacted price of about S$2,000 per square foot.

According to Mr Lee, the development sold more than 80 per cent of its units on launch day and, as at end-May 2021, is almost 90 per cent sold.

"There is demand for homes in one-north precinct which is unsatisfied," he said.