Tampines Street 95 GLS Site Tender: New Record Price of $768 PSF PPR for EC Sites

SINGAPORE, 24 October 2024 – Record-setting land price and higher than usual number of bidders showcase developers’ confidence in the EC market

The top bid of $465 mil ($768 psf ppr) is just 1.6% higher than the next-highest bid of $458 mil ($756 psf ppr), this slim margin indicates close competition between bidders.

A total of five bids were received for this site, which is higher than what we have seen in the past GLS closings in 2024. But this pales in comparison to the nine bids received for the Tampines Street 62 Parcel B site closed in 2023. Nonetheless, the demand for the site was as expected. EC sites generally translate to lower risks for developers due to the lower development cost and higher demand from buyers drawn in by affordable prices compared to new private home launches.

Seperately, the recent interest rate cuts could be a stepping stone for developers to be on track in regaining confidence in the market and could be anticipating a more positive outlook on market conditions. 

But developers will need to price their units realistically in view of the income ceiling of $16,000 for ECs and the 30% Mortgage Servicing Ratio imposed on buyers.

 Plum EC Site in a Popular Town

Compared to the Jalan Loyang Besar and Tampines St 62 (Parcel B) sites, the smaller Tampines St 95 site could have been a more palatable development size for developers, especially for developers aspiring to penetrate the EC market. Tampines continues to be a popular location for developers, going on to sweep the title of Singapore’s most well-connected regional centre. Moreover, this site is within walking distance to Tampines West MRT Station and an upcoming integrated development that provides for residents’ needs. These factors are important to buyers today, which explains developers’ interest for the site.

Resilient buyers’ demand, depleting supply for new ECs

The last EC launch (Tenet) in Tampines sold 72.3% of its units at launch at an average price of $1,360 psf in December 2022. Additionally, the latest launch, Lumina Grand at Bukit Batok, in January 2024 saw 53% of its units transacted at launch. Despite market headwinds, demand for ECs have remained consistently healthy.

Given Altura’s and Lumina Grand’s median transacted prices are $1,479 and $1,524 respectively, we can expect the upcoming project to launch in the upwards of $1,600 psf. A 3-bedroom unit will be priced approximately from $1.5m. That could translate to significant cash outlay upfront, which can be managed by most of second timer buyers when they sell their existing flat.

Top bidder’s confidence buoyed by familiarity of Tampines

The top bidder, Sim Lian Group, could have been confident to pursue the site having developed familiarity with the market in Tampines from their previous private residential projects in the area. This includes Treasure at Tampines, The Tampines Trilliant, Centrale 8 at Tampines, Waterview and the EC site at Tampines Street 62 (Parcel A).

Sim Lian Group could have also placed a competitive bid in a strategic move given that they have successfully bidded for the Tampines Street 62 (Parcel A) in efforts to maintain launch prices.

For media enquiries, please contact:

Eugene Lim, Key Executive Officer, ERA Singapore

Email: [email protected]