SP Setia Bhd, which is turning into Permodalan Nasional Bhd’s (PNB) regional property powerhouse, has won a highly-competitive bid to develop a prime piece of land in Singapore.
The property developer was awarded the tender by Singapore’s Urban Redevelopment Authority (URA) for the 1.87ha on Toh Tuck Road at a winning bid of S$265mil (RM847.6mil).
According to the URA, the second-highest bidder was SingHaiyi Investments Pte Ltd at S$260.2mil followed by Centrex Developments Ltd at S$250mil. The Top 10 bidders had submitted tenders of more than S$200mil each.
The price paid by SP Setia is believed to be among the highest to develop a piece of land in the city state.
SP Setia’s winning bid of S$265mil represents a gross floor area (GFA) of S$939 per sq ft for a site area of 1.87ha and a plot ratio of 1.4 times. The development, which will be launched in 2018, carries a gross development value of S$457mil with a total GFA of 26,210 sq m.
It is worth noting that Malaysian developers are setting the pace for record land bids in Singapore. Last year, IOI Properties Group Bhd had submitted a bid of nearly S$2.57bil or S$1,689 per sq ft for a 1.1ha site in Marina Bay. The new project adds to SP Setia’s current growth aspirations. It has recently announced plans to buy a 343-acre parcel of land in Bangi, Selangor, and has signed a memorandum of intent to acquire I&P Group Sdn Bhd, a property developer which is owned by SP Setia’s substantial shareholder PNB.
The plan is said to be driven by PNB’s desire to accelerate the value creation in its property portfolio. The acquisition will turn SP Setia into one of the largest developers in the region, with an estimated landbank of 10,000 acres once the deal is completed.
SP Setia’s land in Singapore which is located near the upscale Bukit Timah area, will house a five-storey condominium comprising 327 luxury units.
“We are pleased to be awarded the tender of this site by the URA. Singapore is one of our key overseas markets and we will continue to strengthen and grow our brand presence here,” said SP Setia president and chief executive officer Datuk Khor Chap Jen in a statement.
According to the group, residents will enjoy easy access to the Bukit Timah Nature Reserve and Bukit Batok Nature Park, as well as the nearby Pan Island Expressway and Bukit Timah Expressway.
The project will also continue to showcase SP Setia’s strengths in eco-themed developments with modern resort-style facilities and thematic landscaping, it added.
Interest in the Toh Tuck Road site is an indication of the current demand by property developers to secure new prime sites for projects in land-scarce Singapore.
The bidding process was said to be highly competitive from a field of 24 companies. SP Setia’s winning bid also topped earlier estimates for the plot of land, which analysts estimated would go for under S$200mil.
The site, which was offered for sale on a 99-year lease, is the first of five offered under the confirmed list of the government sales programme for the first half of the year.