Since its introduction in 1967, the Government Land Sales (GLS) programme has proven largely instrumental in shaping Singapore’s urban transformation, allowing state land to be sold periodically to interested property developers.
However, the significance of GLS launches extends beyond this role. Their results may also offer key insights into future property prices as well as developer sentiment. So, the big question is: What do the outcomes of the latest GLS tell us?
For a start, by having a closer look at the recent launches at Plantation Close and Media Circle, we can get an idea of how future developments at their respective sites could be valued.
In the case of Plantation Close, which is slated for development as an Executive Condominium (EC), it was awarded to Hoi Hup Realty and Sunway Developments for a total of $423M; this in turn translates into a land cost of $701 PSF PPR.
As for another recent GLS launch at Media Circle, the site attracted a final bid of $395M by Hoi Hup Realty, equating to a land cost of approximately $1,191 PSF PPR.
Based on corresponding land costs, future launch prices of homes at Plantation Close and Media Circle can be respectively estimated to be at $1,550 PSF and $2,500 PSF. Notably, these figures match closely with the median values for prior developments in the vicinity.
For instance, homes near the Media Circle site have median PSF prices of $2,447 (Blossoms by the Park) and $2,699 (Terra Hill). Similarly, private properties in the vicinity of the Plantation Close site are priced at $1,479 PSF (Altura) and $1,525 PSF (Lumina Grand) respectively.
In addition to offering projections for future launch prices, recent GLS sites and their outcomes can also inform us if there are any hidden gems nearby.
For instance, the Orchard Boulevard GLS tender won by UOL Group and Singapore Land Group for $428.3M yields a land cost of $1,617 PSF PPR and an estimated median launch price of approximately $3,600 PSF and upwards.
This estimate for Orchard Boulevard tracks with market prices for other developments in the area, such as 19 Nassim that has a median PSF price of $3,439. However, based on this fact, it becomes apparent that Cuscaden Reserves, which also occupies the same neighbourhood, has great upside potential.
This is due to Cuscaden Reserves’ price of $2,900 PSF following its re-launch in March this year, signifying a value purchase within the Core Central Region, a prime location where properties have traditionally commanded premium prices.
