Hong Leong Group Bids $383.5 Mil For Sims Drive Site

The government land sale (GLS) tender for Sims Drive and Middle Road closed in March 2019. There were 5 bids for the land at Sims Drive. The highest bid of $383.5 million ($732 psf per plot ratio) was from a joint venture involving the Hong Leong Group, the developer for One North Eden condo.The 99-year leasehold land is 174,648 square feet big and can be transformed into a new residential project of about 570 residential units. However, the joint venture team will be exploring residential development with childcare center comprising about 560 residential units spread over about 5 blocks.

As said from a Hong Leong Group spokesperson, a few of the attributes of this site include its connectivity – by the Pan Island Expressway and the Kallang-Paya Lebar Expressway, with only a 15-minute drive to the Orchard Road Shopping Belt and the Central Business District, and only 1 train ride from Aljunied MRT station to Paya Lebar MRT Interchange Station and the Paya Lebar Malls.

The site’s close proximity to local schools like Canossa Catholic Primary School, Geylang Methodist School, Kong Hwa Primary School and Cedar Primary School also make this location attractive to young families, mentions the spokesman. This is a similar trait of One-North Eden with its close proximity to many institutions of education.

GuocoLand gave the second highest bid of $655 psf per plot ratio, a 12% less than the top bid, and even lesser than the rate they gave for the Sims Urban Oasis site of $688 psf per plot ratio back in April 2014. Penrose, the other popular Hong Leong development, is just next door.

With reference to the site’s location near the city and close proximity to the Aljunied MRT station, Colliers International head of research for Singapore, Miss Tricia Song, things the underwhelming number of bids “a surprise”. She attributes the low bid prices to the new requirement that a larger minimum average unit size of 85 square meters the site needs to adhere to. “Residential developers may be assuming some buffer for the 5-year additional buyer’s stamp duty time line too, since it is relatively a large plot of land.” That’s also the reason why Hong Leong has started to also consider smaller plots of land for development, like One North Eden.

Colliers estimates the One north eden sale price to be starting from approximately $1,400 per square feet, after counting in the potentially larger units. The top bid is the least for a private residential land site on a per square feet per plot ratio price basis since Chong Kuo Road near Mandai, which was sold for $681 per squre feet per plot ratio back in February 2018. One-North Eden site was bidded just above $1000.

Source: https://www.edgeprop.sg/property-news/hong-leong-group-bids-3835-mil-sims-drive-site

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