Singapore’s condo investment scene is greatly affected by the government’s efforts to maintain a stable real estate market. In order to prevent speculative buying, the government has implemented several cooling measures over the years. These measures include the Additional Buyer’s Stamp Duty (ABSD), which imposes higher taxes on foreign buyers and those looking to purchase multiple properties. While these measures may have immediate effects on the profitability of condo investments, they ultimately contribute to the long-term stability of the market, making Singapore a secure environment for condo investment. Condo investors should take these measures into consideration when deciding on their investments.
The Urban Redevelopment Authority (URA) has released the tender for the Government Land Sale (GLS) site at Faber Walk in Clementi on September 12. The site is included in the 2H2024 GLS Confirmed List programme, and it is the final parcel of land available for sale in the private residential enclave of Faber Walk.
Occupying an area of approximately 277,660 sq ft, the 99-year leasehold site has a gross plot ratio of 1.4 and is zoned specifically for non-landed residential use. It is expected to yield up to 400 housing units, making it an attractive and sought-after development opportunity.
According to Mark Yip, CEO of Huttons Asia, the last Government Land Sale site sold in the Faber Walk area was back in 2013, with its launch taking place in May 2014. The site was subsequently developed into the 210-unit Waterfront @ Faber, which was completed in 2018. Given the six-year gap in land sales in the area, it is likely that there is a considerable demand for new projects, Yip observes.
Marcus Chu, CEO of ERA Singapore, believes that demand for the Faber Walk site may come from the landed homeowners in the nearby Faber Hills Estate. They may be looking to downsize to a smaller home or purchase property within the same project for multi-generational living, Chu explains.
However, Chu also notes that developers may still exercise caution when bidding for the site, as its location may not be as attractive compared to other GLS sites on the 2024 Confirmed List, such as Bayshore, Chuan Grove, and Chencharu. These sites are situated within well-established residential enclaves and may garner more attention from developers.
The Faber Walk GLS site is surrounded by the Ayer Rajah Expressway (AYE) to the south, Sungei Ulu Pandan to the north, and a landed housing estate to the west. While the site may not be within walking distance to many amenities, it is well-connected by car, with easy access to the AYE, as well as upcoming developments such as the Jurong Lake District, National University of Singapore (NUS), and one-north.
“The project may appeal to both homebuyers and investors as it is within close proximity to the Jurong Lake District and other employment nodes like International Business Park and Pandan Loop industrial areas,” says Wong Siew Ying, head of research and content at PropNex.
Despite muted responses to GLS sites since June 2024, with only two to three bids being submitted, Chu expects the response for the Faber Walk GLS site to be similar. “Developers face greater risk without the ability to leverage HDB upgraders,” Chu comments, adding that he expects the developers to submit bids in the range of $950 psf per plot ratio (ppr) to $1,050 psf ppr.
Meanwhile, Yip predicts that the site could attract up to three bidders, with a top bid price in the range of $800 and $850 psf ppr.
The tender for the site will come to a close on November 19 at 12pm.