Tender for Eng Lok Mansion draws 8 bids
Highest offer of $128m works out to new record of $1,130 psf ppr
THE tender for the freehold Eng Lok Mansion, near the Botanic Gardens, has attracted eight bids. And the highest offer - said to be about $128 million - works out to a record $1,130 per square foot per plot ratio.
The top bid for the Napier Road property is believed to have been placed by parties linked to former Parkway Holdings boss Tony Tan, working with Penang’s Island Hospital group in which Mr Tan’s family has a stake. Parkway Group is also understood to have placed a bid, of about $120 million.
Based on the $1,130 psf ppr top bid, the breakeven cost for a new condo would be about $1,500 to $1,600 psf.
If $1,130 psf ppr is indeed the highest bid and the property is awarded to the top bidder, it will pip the highest-ever unit land price for a freehold residential site in Singapore - $1,122 psf ppr that Hong Leong Group paid in April 1997 for Boulevard Hotel, which has been approved for redevelopment into a condo.
The highest-ever unit land cost for a collective sale so far is $1,093 psf ppr paid by Far East Organization in January 1997 for Scotts Tower.
Incidentally, Eng Lok’s top bid also busts the recent high of $1,058 psf ppr set last month when Far East bought Angullia Mansion.
‘But the difference is that the Angullia Mansion site can be redeveloped up to 36 storeys high, whereas the Eng Lok site has a 10-storey height limit. So the price for Eng Lok does seem high,’ says a market watcher.
But others beg to differ. Wheelock Properties (Singapore) CEO David Lawrence, whose company was not among the bidders for Eng Lok, said: ‘Our Grange Residences project has proved that the location is extremely popular.’
Mr Lawrence, who is also chairman of UK-based property consultancy Hamptons Group, said: ‘Singapore is becoming increasingly attractive to invest in. I am surprised by the level of interest from UK, Irish and German investors asking me about investing in Asia, particularly Singapore. Already, I have an Irish group asking me if they can buy a lot of units in Scotts Square. Singapore is looking very attractive as an investment location for international investors.’
Besides often-cited factors like good government, ‘Singapore is seen as a place where a lot of the emerging middle class money from China and India will go to. They see Singapore as a place that will do very well for the next 10 years’, Mr Lawrence added.
Scotts Square is the new project that Wheelock will develop on the Scotts Shopping Centre and The Ascott serviced residences site.
The tender for Eng Lok Mansion closed on Tuesday. The other bidders are said to include CapitaLand, Lippo Group and Simon Cheong’s SC Global.
Market watchers say Parkway Group’s bid of $120 million is probably conditional on the site being re-zoned from residential to healthcare use, since it could then build an extension to its Gleneagles Hospital next door to Eng Lok Mansion.
The 70,810 sq ft Eng Lok Mansion site is zoned for 10-storey residential use with a 1.6 plot ratio (ratio of potential maximum gross floor area to land area) under Master Plan 2003. But marketing agent CB Richard Ellis (CBRE) was reported as saying in December last year that ‘alternative development options could possibly be explored with the relevant authorities due to its strategic location’. At the time, it was suggested that alternative uses could include hospitals, medical suites or a hotel. BT understands that Eng Lok Mansion’s owners submitted an application to the Urban Redevelopment Authority (URA) to explore some of these alternative uses, most likely hospital, but that URA recently rejected the application.
Source : Business Times - 2 Mar 2006
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