Thursday, August 30, 2012

Far East tops bid for Farrer Rd site, beating 14 others

Business Times: Wed, Aug 29

PROPERTY giant Far East Organization yesterday muscled out 14 other bidders to emerge as the top bidder for a smallish 99-year leasehold plot at Farrer Road (next to Lutheran Towers). The plot can potentially generate up to 54 apartments.

Far East was the only major residential player that took part in the state tender.

Its unit, Far East Soho, bid $45.777 million, or $1,107.80 per square foot per plot ratio (psf ppr), for the 29,509 sq ft plot. Its bid was 3.3 per cent higher than the second-highest bid of around $44.3 million or $1,072.73 psf ppr - from industrial property developer Soon Hock group's unit, Soon Hock Tuas Development.

In third spot was Lamo Pte Ltd - a privately owned vehicle of The Hour Glass executive chairman Henry Tay and his son Michael - bidding about $41.38 million or $1,001.48 psf ppr. The lowest bid at yesterday's tender was from a tie-up between Bohai Investments (Seng Kang) and ZACD Investments, which offered slightly over $31 million or $750.61 psf ppr.

Credo Real Estate executive director Ong Teck Hui described Far East topping bids at yesterday's tender as "sweet victory" after it was beaten into second place two months ago for the nearby Farrer Drive plot, which can yield a bigger development of around 100 units.

SingLand paid $1,048.52 psf ppr for the Farrer Drive site - which is behind Sommerville Grandeur and near Farrer Road MRT Station - 10 per cent more than Far East's offer of around $952 psf ppr.

The latest plot tendered yesterday, within walking distance of Botanic Gardens MRT Station, can be developed up to five storeys and can have no more than 54 units, based on a formula which assumes an average home size of 70 square metres (753.47 sq ft) gross floor area under development control guidelines issued last November on the maximum number of units for flat and condo developments within residential estates with 1.4 plot ratio.

Commenting on Far East's plans for the site, the group's executive director, property services, Chng Kiong Huat, said: "This compact site gives us the opportunity to expand our Far East SOHO brand and innovate on our product development with a new suite of SOHO apartments with unique layout and space planning concepts."

The proposed scheme will comprise a mix of one and two-bedroom apartments with high ceilings, "with the majority of units being two-bedders to cater to young families who appreciate trendy and flexible spaces in an urban setting", he added.

"Embracing the creative interpretation of live-work-play spaces, the new development will bear the hallmarks of the Far East SOHO brand - locale, connectivity and flexible space."

The site enjoys a central location near the shopping, dining and recreational amenities in the Botanic Gardens and Orchard Road, Far East said.

DWG's senior manager, Lee Sze Teck, estimates Far East's break-even cost at $1,500-1,600 psf and expects the selling price for the new project to be around $1,800-1,900 psf.

A seasoned property consultant estimates Far East's selling price as close to $2,000 psf, "giving them a decent profit margin".

Bidders at yesterday's tender included BBR Property, Chee Tat Holdings unit Plaza Development, Chng Gim Huat Group's Eastwood Park, Link (THM) Ultimate Homes, Lian Soon Realty, Goodland Assets, Chip Eng Seng Corporation unit CEL Property, and Tiong Aik Land. Also participating at the tender was China-based Hangzhou Huayuan Real Estate Group's Singapore-incorporated unit Huayuan Interntional Development Group Pte Ltd. It teamed up with Hua Yuan Organization Pte Ltd to bid $31.8 million ($769.55 psf ppr), placing it as the third-lowest bidder.

Manston Land - whose shareholders are Ronald Zung Bei Fan and Karen Zung Yuen Ying - bid nearly $31.7 million.

Martin Koh | 86666 944 | R020968Z
Sherry Tang | 9844 4400 | R020241C
Senior Sales Director
DTZ Debenham Tie Leung (SEA) Pte Ltd (L3006301G)

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