White site at Marina View triggered for sale at a minimum bid of $1.5 billion
By Cecilia Chow
/ EdgeProp Singapore |
The new mixed-use development at Marina View will be a new landmark in Singapore's CBD (Photo: Samuel Isaac Chua/EdgeProp Singapore)
SINGAPORE (EDGEPROP) - An undisclosed real estate developer has triggered the release of the white site at Marina View for sale by tender. It is scheduled for launch on June 28, according to URA. (See also: One Address Has It All)
The site is located near the Singapore Conference Hall, and within a two-minute walk of the upcoming Shenton Way MRT Station on the Thomson-East Coast Line. It’s an 84,148 sq ft, 99-year leasehold site with a plot ratio of 13 times, which will yield over a million sq ft of space, says Nicholas Mak, head of research at ERA Realty.
The white site has the potential to yield a mixed-use development with about 900 residential units, a hotel with about 540 rooms, and commercial space of about 2,000 sqm (21,528 sq ft).
Credit: URA
The application bid of $1.508 billion to trigger this site translates to a land rate of $1,379 psf per plot ratio (psf ppr). In terms of absolute amount, it is not the largest application bid for a GLS reserve list site. That honour goes to the white site at Central Boulevard, which was launched for sale after a developer triggered its launch with a minimum bid of $1.536 billion, or $1,010 psf ppr in August 2016, notes Mak.
The site was eventually sold to Malaysian group IOI Properties, which submitted the top bid of $2.57 billion ($1,689 psf ppr). IOI’s Central Boulevard Towers will have predominantly office space – 1.29 million sq ft of Grade-A office space. Most of the white sites in the Marina Bay area that were sold under the Government Land Sale (GLS) were previously for office developments or mixed-use developments with a significant office component, points out Mak.
Credit: URA
Significant residential component
The Marina View white site this time is different, as the residential component is significant. “The land price for the site will be influenced by prices of residential units in that area,” says Mak.
When compared with other somewhat similar GLS residential sites (excluding the large, predominantly commercial white sites) in the Downtown Core, the trigger price on a psf ppr basis is found to be less than the recent bids, points out Leonard Tay, head of research at Knight Frank Singapore.
The trigger price of $1,379 psf ppr is 10.2% less than the winning bid for the residential site at Tan Quee Lan Street (awarded in September 2019 to the winning bid of $1,535 psf, and launched as Midtown Modern); 5.7% less than the winning bid for the residential site at Bernam Street (awarded in September 2019 to the highest bid of $1,463 psf ppr and launched as One Bernam); and 5.4% less than the winning comparable bid for the residential site at Middle Road (awarded on April 2019 at $1,458 psf ppr, and launched as The M). Tay expects the submitted bids to be higher on a psf ppr basis than those of the previous GLS sites sold.
The Tan Quee Lan site that was sold in September 2019 for $1,535 psf ppr, and launched for sale as the 566-unit Midtown Modern in March this year (Photo: Samuel Isaac Chua/EdgeProp Singapore)
Future prices of residences - $2,500 to $2,800 psf?
The table below shows the year-to-date transacted prices of comparable residential properties (based on median prices from January to May 2021):
Based on the table above, and the projected trajectory of property prices in the area, ERA’s Mak estimates that the future residential units at the new development at Marina View is likely to be launched for sale at prices between $2,500 and $2,800 psf, “provided the government does not introduce any new cooling measures before the launch of this new project”, he adds.
The site is not just next to the upcoming Shenton Way MRT station, but within walking distance to the Marina Bay MRT station, which will be an interchange for three lines: the upcoming Thomson-East Coast Line as well as the existing North-South and Circle Lines.
The launch of the Marina View white site will carry on the momentum of development in the New Downtown, says Ong Teck Hui, JLL senior director of research and consultancy. “It will provide more homes and hotel rooms to inject vibrancy in the city,” he adds. “There should be keen demand for residential units as the last residential sales launch in the area was that of Marina One Residences in 2014.”
With AXA Tower at 8 Shenton Way (left) and Fuji Xerox Towers being redeveloped, the CBD is being rejuvenated (Photo: Samuel Isaac Chua/EdgeProp Singapore)
Reinventing the CBD
Ong Choon Fah, CEO of Edmund Tie says that the Covid pandemic is leading to a reinvention of the CBD. “It’s no longer just the central business district but a central activity zone,” she says. “Old buildings are being redeveloped.”
The Marina View white site is likely to attract Chinese developers and investors, says Edmund Tie’s Ong. “There are a number of them looking at developing an iconic building in the CBD,” says Ong. “The site presents an opportunity for a company to brand itself and to show what they are capable of doing in a development of such a scale.”
Given the scale of the development, Edmund Tie’s Ong expects the site to attract companies bidding together in joint ventures or as part of a consortium. Despite the pandemic, prime Grade-A office space remains sought-after. “In the longer-term, talent will gravitate to quality space,” she says. “The whole landscape has changed. If you look at the profile of occupiers in the CBD today, there’s no one dominant occupier type, but a diverse range. And that’s what makes the city more resilient.”
Check out the latest listings near Marina View, Marina One Residences, Midtown Modern, One Bernam, The M, Shenton Way MRT Station, Marina Bay MRT station
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