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AN EXECUTIVE condominium (EC) site in Tampines Street 95 drew strong participation from developers, with the top bidder Sim Lian setting a new record for EC land with its offer of S$768 per square foot per plot ratio (psf ppr).

The Housing and Development Board (HDB) tender that closed on Thursday (Oct 24) attracted five bids. Market watchers had expected bids to come in at between S$650 and S$730 psf ppr.

While the strong showing did not surprise market watchers too much, the latest result showed that developers see EC projects as “a sure thing” in an uncertain market, said Nicholas Mak, Mogul.sg’s chief research officer.

Eugene Lim, ERA Singapore’s key executive officer, made a similar point: “EC sites generally translate to lower risks for developers due to the lower development cost and higher demand from buyers who are drawn in by the affordable prices, relative to those of new private home launches.”

Sim Lian’s S$465 million bid at S$768 psf ppr was 1.6 per cent higher than the next highest offer of S$756 psf ppr (S$457.5 million) from a consortium comprising Santarli Construction, Apex Asia, construction group Kay Lim Realty and Heeton Holdings.

This was followed by Sing Holdings, with its bid of S$439.6 million or S$726 psf ppr; Chinese developer CSC Land put in an offer of S$438.8 million or S$725 psf ppr. The lowest bid came from Hong Leong Holdings’ Intrepid Investments and TID Residential, at S$425.7 million or S$703 psf ppr.

If Sim Lian wins this tender for the Tampines Street 95 plot (as is likely), it would count as the developer’s third EC project in Tampines.

Last October, it acquired an EC site in Tampines Street 62, where it is now building the 760-unit Aurelle of Tampines, slated to hit the market in the first half of 2025.

Sim Lian is also behind The Tampines Trilliant in Tampines Central, completed in 2015. (Sim Lian also has completed EC projects in Choa Chu Kang and Anchorvale.)

PropNex head of research and content Wong Siew Ying described Sim Lian’s “bolder bid” to secure the site as a strategic move to defend its market position.

Mogul’s Mak added: “This land bidding strategy not only reduces competition for Sim Lian in the Tampines area, but also empowers the developer to set pricing for their two EC projects without the risk of being undercut by other developers.”

“As a result, it can effectively corner the EC market in Tampines for the next two to three years, enhancing its influence and profitability before the government sells another EC site in Tampines,” he said.

Pricing

At the top bid of S$768 psf ppr, analysts said that the latest EC project in Tampines could be priced at between S$1,500 and S$1,750 psf.

Given the 15-month waiting period from the time of land acquisition to the launch of the EC, this project will be launched only sometime in 2026, noted Justin Quek, OrangeTee & Tie’s chief executive officer.

There will not be too much competing demand to divert buyers’ attention away, so the gap between launches may help to ensure sufficient demand, he added.

Sim Lian’s S$768 psf ppr bid was also 5.1 per cent higher than the winning bid at the last EC tender. A site in Jalan Loyang Besar in Pasir Ris was awarded in August to a joint venture between CNQC International (the parent company of Qingjian Realty), China Communications Construction Company, and ZACD at S$557 million or S$729 psf ppr.

Lower financing costs with recent interest rate cuts could also have given developers more confidence, ERA’s Lim suggested.

EC land rates have been steadily rising over the past few tenders. Qingjian’s bid of S$729 psf ppr for the Jalan Loyang Besar site in August was a shade higher than the S$721 psf ppr that Sim Lian paid for the Tampines Street 62 plot in October last year.

With the median unit price of new mass market condos in the suburbs at S$2,145 psf so far this year, PropNex’s Wong said that ECs which are more affordably priced – at a median price of S$1,500 psf – will remain appealing to eligible buyers.

Based on URA’s monthly sales data, there were only 171 unsold new EC units on the market as at the end of September, the bulk of these units being in Bukit Batok and Yishun, she noted.

The Tampines Street 95 plot measures 22,488.9 square metres (sq m), and has a maximum gross floor area of 56,223 sq m.

A total of some 560 housing units can be built in the project, which is near the Tampines West MRT station.

The site is also near an upcoming 23,510.7 sq m mixed-use site for up to 585 new residential units and commercial space.

That plot was awarded to the Hoi Hup-Sunway entity at S$668.3 million or S$1,004 psf ppr earlier this month.

The last EC project launched for sale in Tampines was Tenet, jointly developed by Qingjian Realty, Santarli and Heeton. Launched in December 2022, the project is almost sold out, with one unit left as of October. 

EC project in Bukit Batok

Another EC project in Bukit Batok, City Developments’ Lumina Grand, was marketed in January this year and has sold 83 per cent out of its 512 units, said Wong.

The next EC to be launched will likely be Novo Place in Tengah, which could yield 504 units.

A joint venture between Hoi Hup Realty and Sunway Developments won the site at S$423.2 million, or S$701 psf ppr, in February.