The Urban Redevelopment Authority’s (URA) reserve list has been updated to include a Zion Road parcel after an application was received committing a bid that could not be lower than approximately $604.6million.

The launch the tender for Zion Road is following the sale by URA a few months ago of a bigger neighbouring site along Zion Road. It was awarded to the City Developments Limited Mitsui Fudosan(CDL-Mitsui), a joint venture, at their single bid of $1.02 billion, or 1.202 cents per square foot and plot ratio.

CDL Mitsui’s Bid for Parcel A Site was 30% Lower than a similar State Land Site across the Road.

Zion Road is off the reserve lists in the Government Land Sales Program (GLS). This will happen for the GLS programme’s first half of 2020. Reserve list land plots may be sold if an acceptable minimum price is offered by a developer and there is sufficient interest in the market.

URA revealed that a developer’s application to commit to submitting an offer at a price minimum of $604,567.890 triggered the sale of the Zion Road Reserve site. The developer’s identity was not disclosed.

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The minimum of $604.6M translates to land rates of approximately $1,080psfppr. That is about 10% lower than Parcel A’s price of $1.202psfppr.

The second Zion Road plot is smaller than the one that was sold and there are no requirements to build new serviced apartments, SA2, in the development.

Parcel B has a lower development risk because it lacks the SA2 and is about 60 percent of Parcel A’s GFA. It should also warrant a more favorable land rate. “We anticipate that the CDL Mitsui JV is interested in defending this area and we expect more developers to take an interest in the prime site,” Ms Song said.

CBRE believes that the plot could receive three or four bids. The highest bid would be $1,300 to $1.380 dollars per square foot, a price between $730 and $770 million.

The site area for the land parcel located in Zion Road is 9285.9sqm, and its maximum gross floor space is 52.002sqm.

The tender was announced as part of plans by the government to make 5,450 housing units available through the confirmed list under the GLS first-half programme 2024. This is the largest unit supply since the GLS 2nd half 2013 programme.

The tender will be closed in July of 2024.