Three bids were submitted for Government Land Sales at Pasir Ris Central White Site
At the close of the Pasir Ris Central White Site on 14th December, the HDB announced that that a total 3 tenders were received. This is the first mixed used land parcel under the Government Land Sales to be put up for tender since the cooling measures in July 2018.
The total number of bids for the white site was considered lacklustre by the industry watchers due to its strategic location next to the Pasir Ris MRT Station and White Sands Pasir Ris. The performance also pales in comparison to the recent Holland Road Government Land Sales which attracted 15 bidders at the close. Besides the high absolute amount of the investment and technical conditions of the tender, the results of the tender may also reflect the concerns amongst developers on the cooling measures and weaker economic outlook.
The successful tenderer is expected to build a temporary bus interchange before the developer can commence selling the residential units. The delayed sale of the residential units not only has a negative effect on the cashflow but increases the risk of penalty if the developer fails to offload the condominium in time.
There are other requirements embedded in the tender to build a polyclinic, child care centre and a PUDO for MINDEF. The residential component is also capped at 600 dwelling units for this development. However, the crown jewel for this land parcel is the retail component which can provide long term strategic income for the winning tenderer. Given the inadequacy of shopping malls, the success of the retail can be assured by its strong resident population and visitors from neighbouring towns such as Punggol and Tampines.
Details of the tender participants
The three bidders were Far East Organization, Singapore Press Holdings (SPH) and Kajima Development and Allgreen Properties and Kerry Properties as revealed by HDB on 14th December 2018.
In May 2018, a Far East-led consortium won the Holland Road mixed use GLS for $1.213 billion. The 99 years leasehold site has a land area of 22,967 square metres and a maximum permissible GFA of 59,715 sqm that shares similarity to the Pasir Ris Government Land Sales in 2H2018.
In June 2017, SPH and KAJIMA won the Bidadari mixed use GLS for $1.132 billion which features the first full air-conditioned underground bus interchange. The 99 years leasehold site has a land area of 25,440.80 sqm and a max permissible GFA of 89,043 based on a plot ratio of 3.50 will now be developed partly in an integrated condominium called The Woodleigh Residences.
Allgreen Properties is an experienced real estate developer with a exhaustive list of portfolio and achievements. Allgreen is currently upgrading the iconic Great World City shopping mall and office towers that is located next to the upcoming Thomson-East Line.
While the response for the Pasir Ris Central GLS tender was lower than expected, all three participants have proven track records and deep expertise in managing malls, strong financial position and vast experience in developing mixed-use projects. While the current sentiments may be weaker, the developers may have set their sights further for Pasir Ris to benefit from the existing infrastructure and future plans by HDB to rejuvenate the town.
In the recent years, there were several amenities such as the sports complex and hawker centre located near the Pasir Ris park which were recently completed. The shopping mall at Downtown East also undergone extensive renovation to better serve its new residents in Pasir Ris and it has been a great success.
Pasir Ris Central Government Land Sale complement its future plans
The launch of the Pasir Ris GLS site is in line with the Housing Board’s plan to rejuvenate Pasir Ris Town under its Remaking Our Heartland programme. Under the planning area Pasir Ris, the 2017 statistics registered a total of 144,960 residents with Pasir Ris Central and Pasir Ris Drive having the highest residents.
There are a total of 106,330 residents living in HDB dwelling units, 30,740 residents living in condominiums and apartments, 7,270 residents living in landed properties and 620 residents registered as others. The new integrated mixed use development will be an interesting addition to the existing and future residents to provide a focal point for community gathering.
HDB has announced in April 2017 that some 2000 units of public housing will be built in Pasir Ris which will be integrated with the proposed Central Greenway. There will be dedicated cycling and pedestrian paths to provide direct connection to Pasir Ris interchange and Pasir Ris Park.
Under the ROH programme, there will be upgrades for four existing neighbourhood centres, Pasir Ris West Mall and Elias Mall. The programme has plans to improve the last mile connection to public transport and infrastructure through the construction of sheltered pathways from strategic points to provide a seamless connection.
Under the ROH programme, five out of the seven Neighbourhood Parks in Pasir Ris will receive a facelift, with the injection of new multi-generational facilities and enhanced landscaping. The five Neighbourhood Parks are Brontosaur Park, Green Oval Park, Seashell Park, Park Aquaria and an open space at Loyang.
The strategic location beside the Pasir Ris MRT station and increased government from the ROH programme do provide a strong assurance of a successful retail mall and keen demand for the residential units.
With the Cross Island MRT due to be confirmed in the near future, the finalised plans will improve the connectivity of Pasir Ris to other parts of Singapore by 2030. The improvement from ROH programme and the upcoming Cross Island MRT will certainly attract more families to move into Pasir Ris for its beach resort lifestyle, improved connectivity across the island, ongoing development at Seletar Aerospace Park and Changi Jewel. There will be limited downside risk for home buyers in Pasir Ris at its given attractive entry level in 2018.
In late 2018, the residential development known as Elias Green has garnered more than 80% of the owners to launch an attempt for the collective sale which will close on 11 January 2019. The developers who missed out on the opportunity at Pasir Ris white site could make an attempt to replenish its land bank with Elias Green en bloc.
Results of Pasir Ris Government Land Sales to be revealed by HDB at later date
Under the concept and price revenue tender system, the HDB will be assessing the details of the proposals for the following areas: Quality of Design Concept (40%), Quality of Public Realm (30%) and Track Record (30%).
The tender proposals that satisfy the evaluation criteria will be considered for award at the second stage. The price envelopes of the proposals with acceptable concepts will be opened for consideration and awarded to the highest bid price.
The successful tenderer will have up to 96 months to complete the development from the date of acceptance. The results of the Pasir Ris Central White Site could be finalised by mid February 2019 based on a similar timeline of the Holland Road tender managed by URA.