At the close of URA’s tender for a residential site at Jurong West Street 41 (Parcel B), property developer MCL Land emerged the winner of the site, with the highest bid of $338.1 million or $630 psf per plot ratio (ppr). The price is 21% higher than the average price of a total of nine bids submitted, reflecting confidence in the site, notes Desmond Sim, head of research for CBRE.

The eight other bids received for Parcel B were less than $600 psf ppr. “MCL Land may be motivated to win the GLS tender in order to protect its market position in the [area],” reckons Nicholas Mak, executive director of research & consultancy for SLP International.

MCL Land had topped the bid for the neighbouring site (Parcel A) two years ago. It paid $438.8 million ($651 psf ppr) for Parcel A, which is 3.2% higher than its bid price for Parcel B. Based on the purchase price of $630 psf ppr for Parcel B, Mak estimates the breakeven price of the new condo to be built there to be in the $1,070 to $1,120 psf range. Parcel A was launched last year as the 696-unit Lakeville condo, and as at end-January 2015, 385 units (55.3% of total) have been sold at a median price of $1,378 psf, according to URA data.

This article appeared in the City & Country of Issue 668 (Mar 16) of The Edge Singapore.