26/12/2021
23 December 2021, SINGAPORE β The GLS tender site at Bukit Batok West Avenue 8 EC has been launched for tender today by the HDB. We expect the executive condominium (EC) site to attract a fairly healthy turnout of bidders, given the diminishing supply of new EC units in the market, as well as developers potentially seeking a less-risky development site to add to their land inventory. ECs have always been popular among homebuyers owing to their more affordable prices. In addition, ECs tend to appeal to the groups of buyers, such as first-time Singaporean home buyers or HDB upgraders who are least affected by the new cooling measures.
This EC site spans 12,449.3 sqm (with a maximum GFA of 37,348 sqm) β it will offer up to 375 units when completed. The development is located in the suburban area of Bukit Batok where private housing supply is fairly limited, the last private residential project was the nearby Le Quest in Bukit Batok West Avenue 8 which enjoyed hot take-up when it was launched in August 2017. The new EC project will be popular amongst HDB upgraders in the area looking for a private home within the same estate.
The site is 10 minutesβ walk from Bukit Gombak MRT station and has a number of schools in the vicinity such as Dazhong Primary School, Dunearn Secondary School, St Anthonyβs Primary School, Eden School, Princess Elizabeth Primary School as well as Millenia Institute.
Developers will note that an adjacent EC site at Bukit Batok West Avenue 5 β which is larger and can yield 495 units β is slated to be launched for tender in June 2022 under the GLS 1H 2022 programme. This upcoming site may pose competition for the Bukit Batok West Avenue 8 plot, however, the plot in Avenue 8 will get a head start to market and sell units since EC sites are subjected to the 15-month rule.
Due to the dwindling supply of unsold EC units, we expect a keen interest for this site as developers seek to replenish their land bank. As the site is relatively mid-sized and with the expected quantum of the land cost expected to be less than $300 million, it will appeal to a wider range of developers. We are projecting this site to receive between 8 and 12 bids.
In July 2021, EC land prices hit another high with the closing of the Tampines Street 62 EC site tender which achieved a winning land bid of $422 million, reflecting a land rate of $659 per square foot per plot ratio (psf ppr). Despite the steadfast popularity of ECs amongst buyers, we are expecting the bids for this site to be moderate given the lack of amenities in this neighbourhood compared to the Tampines Street 62 EC site as well as ongoing concerns over rising construction costs amongst developers. We estimate that the top bid for the Bukit Batok West Avenue 8 EC plot could range from $241.2 million to $261.3 million, reflecting a land rate of about $600 to $650 psf ppr.
