1H2021 GLS programme sees first significant increase in residential supply in three years
By Valerie Kor
/ EdgeProp Singapore |
SINGAPORE (EDGEPROP) - In the 1H2021 Government Land Sales programme (GLS) announced today, there are four Confirmed List sites and nine Reserve List sites.
Two new residential sites were moved from the Reserve List to the Confirmed List, namely Lentor Central and Tampines Street 62 (EC). On the Reserve List, a site at Jalan Tembusu has been added.
Confirmed List 1H2021 GLS programme
Location | Site Area (ha) | Proposed gross plot ratio | Est. no. of residential units | Hotel rooms | Est. commercial space (m2) | Est. launch date |
|---|---|---|---|---|---|---|
Tampines St 62 (EC) | 2.37 | 2.5 | 590 | 0 | 0 | Apr 2021 |
Lentor Central | 1.72 | 3.5 | 610 | 0 | 8,000 | Apr 2021 |
Slim Barracks Rise (Parcel A) | 0.79 | 3.0 | 265 | 0 | 800 | Jun 2021 |
Slim Barracks Rise (Parcel B) | 0.59 | 2.1 | 140 | 0 | 400 | Jun 2021 |
Total (Confirmed List) | 1,605 | 0 | 9,200 |
Source: URA
Desmond Sim, head of research at Southeast Asia, CBRE, notes that the number of residential units newly added to the Confirmed List has increased to 1,605 units from a five-year low of 1,370 units in 2H2020. He adds that it will provide a boost for developers to shore up their land inventory since supply from previous GLS has been limited.
“This marks the first significant increase in unit supply in three years, since 2H2017,” says Lee Sze Teck, director of research at Huttons Asia.
As new sale and resale property markets are experiencing healthy demand, consultants unanimously believe that the sites are likely to attract a healthy level of bidding activity, as shown by the tenders of the previous two sites at Tanah Merah Kechil Link and Yishun Ave 9.
“Tanah Merah Kechil Link closed with 15 bids on Oct 29, is a good indication that developers are relatively less risk-averse and are ready to land bank to meet the rising market demand," says Christine Li, head of research at Cushman & Wakefield (C&W).
The Slim Barracks Rise site could attract a high number of bids due to its location (Photo: URA)
In particular, the Slim Barracks Rise sites at one-north could be especially appealing to developers since they are near a transport node, surrounded by the one-north biomedical hub, says CBRE’s Sim. Additionally, since they are in smaller parcels, with 265 units for Parcel A and 140 units for Parcel B, they could be “more palatable and manageable for developers”.
The previous sold in the vicinity was at one-north gateway in September 2019. C&W's Li adds that considering the bright outlook for the biomedical and technology sectors which have both benefited from the COVID-19 pandemic, the demand for the units at the Slim Barracks site will be high.
Sim notes that key sites have been made available around new stations along the Thomson-East Coast Line, similar to the 2H2020 GLS programme.
The Lentor site, spanning 3.5 ha, will have an estimated 615 residential units and commercial space spanning 8,000 sq m. It will also be near Lentor MRT station (Photo: URA)
The Lentor site not only provides more residential units in this enclave, there will also be a new commercial centre with 8,000 sq m of commercial space right above a transport node to serve the vicinity.
As for the Tampines St 62 EC site, it can yield about 590 EC units. Ong Teck Hui, senior director of Research & Consultancy at JLL believes that it could be in fair demand due to moderate supply of new EC projects in the pipeline. "The last time an EC site was sold in this area was in January 2019 when Parc Central Residences land parcel was acquired by Hoi Hup and Sunway Developments," he adds.
On the commercial and hotel fronts, the same sites from 2H2020 have been rolled over to 1H2021, with no commercial sites introduced in the Confirmed List.
Possibility of an en bloc cycle in 2021
Huttons’ Lee says, “The uncompleted unsold units have been declining since 1Q2019. The recent GLS land tender for land too saw a large number of bidders and the en-bloc market has also witnessed two collective sales in the span of two weeks.”
Lee notes that the supply of land appears to be concentrated in two areas, one-north and Tampines. Lee says, “Without a good spread of sites across the island, developers will have to turn to the en-bloc market to seek choice sites and a new en-bloc cycle is expected to take place in 2021.”
Similarly, C&W's Li says, “What is noteworthy is that the current unsold inventory continues to fall and currently it stands at 26,600 units as at Q3 2020. The start of the previous en bloc cycle was in 2Q 2016 when inventory fell to 23,000 units. Should the unsold inventory continue to fall, a possible return of the en bloc cycle can follow.”
The tender will close only in March 2021, which will give developers five months to strategise their land banking in an uncertain time, says Sim. He adds that the Confirmed List moderate the supply but yet provided developers with a good selection of sites in the Reserve List should there be stronger demand.
Check out the latest listings near Tampines St 62 (EC), Lentor Central, Slim Barracks Rise, Tanah Merah Kechil Link, Yishun Ave 9
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