URA launches GLS site at Chuan Grove: Commentary by ERA

SINGAPORE, 03 December 2024 – The tender for the Government Land Sale (GLS) sites at Chuan Grove launched on 3rd December 2024. The site can potentially yield about 555 units. The tender for sale will close at 12 noon on 8 July 2025.

Attractive Location in the Lorong Chuan Area

The Chuan Grove site is within a 5-minute walk to Lorong Chuan MRT station on the Circle Line, connecting residents to the North-South Line at Bishan and North-East line one station away. Additional stations between HarbourFront and Marina Bay will also be added to the Circle Line by 2026 to complete the MRT line loop.

The site is also located one street away from major roads such as the Central Expressway, and residents can enjoy a 10-minute commute to the Central area of Singapore. Despite being located within a residential enclave, the area is surrounded by a variety of educational institutions and within 1km from nearby facilities. Residents can experience an ideal lifestyle, enjoying the convenience of being in proximity to a suite of amenities.

Demand from Landed Estate Right-sizers and HDB Upgraders

Residents from landed estates in Serangoon Gardens, Chiltern, Bartley and Serangoon Central, form a strong pool of right-sizer profiles. Thus, we can expect demand from residents living in these nearby landed enclaves looking to right size their living spaces.

Demand could also come from HDB upgraders living near the site. Within the next four years, an estimated number of 3,815 flats (4-room and larger) in Toa Payoh are set to fulfil their MOP, with the Chuan Grove site one of the options for buyers to upgrade to.

On the other hand, residents of HDB flats in older estates nearby such as Bishan and Toa Payoh could seek to upgrade their homes as well. The median transaction price of 5-room flats in the last 10 months at Bishan and Toa Payoh are $792,000 and $828,000 respectively, which could contribute to a new private home in the area.

Given the increasing number of million-dollar flats in neighboring towns Serangoon, Bishan and Toa Payoh, overall purchasing power is expected to increase. By October 2024, an estimated 20% of million-dollar flats transacted in the year were from these towns. This could also fuel buyers’ available cash on-hand, further boosting demand from HDB upgraders.

Lack of Planned GLS Sites in Lorong Chuan, Possibility of Waiting for Future Collective Sales

Prior to Chan Park’s launch in November 2024, Cardiff Residence was the last launch in 2011, indicating that supply of new homes in Lorong Chuan is limited.

Given the lack of future GLS sites in Lorong Chuan, future developments are more likely to come from en blocs of older condos. We can expect to see similar collective sales in the future, given that a few collective sales have been successful in the area. This includes Cardiff Residence, redeveloped from Cardiff Court, and The Chuan Park which was sold for $890 mil ($980 psf ppr).

Developers Could Compete to Ride on Chuan Park’s Success

Even though we saw the recent successful collective sales at Thomson View, GLS sites like Lorong Chuan are highly attractive since GLS sites have fewer encumbrances.

Developers could be encouraged by Chuan Park’s better-than-expected sales performance and will likely place competitive bids to capitalise on the spillover effects from the pent up demand in the vicinity.

Older condos have been the only options as private residential homes in the Lorong Chuan area for over a decade. Expected pent-up demand translated to an overwhelming response at Chuan Park’s launch, with 76% of the development sold at an average of $2,579 psf at the project’s launch weekend.

The batching of the closing of tenders of the Chuan Grove and Holland Link marks the first two sites to close in 2H 2025, and is indicative of the lengthier tender periods observed for recent GLS sites. This also highlights the efforts made by URA to maintain a healthy pace of the release of new sites in the private residential market.

Conclusion

The Chuan Grove site could be one of the more hotly contested sites on the 2024 GLS Confirmed List given its attractive attributes. Hence, we can expect strong contest between bidders, attracting up to four or five bids.

Developers could also take cues from the overwhelming demand at Chuan Park’s launch weekend and submit more bullish bid prices accordingly. Thus, we can expect bid prices ranging from $571 mil to $600 mil which translates to a land cost upwards of $1,200 psf ppr.

END OF PRESS RELEASE

For media enquiries, please contact:

Eugene Lim, Key Executive Officer, ERA Singapore

Email: [email protected]