Developer OKH Management has placed the top bid of S$27.2 million for the industrial site at Yishun Avenue 6.
This is slightly more than double the minimum bid of S$11.5 million committed by an unnamed developed on March 8 this year.
The top bid of S$27.2 million translates to about S$71 per square foot per plot ratio.
The breakeven cost for this development is estimated to be between S$250 per square foot and S$270 per square foot.
According to the Urban Redevelopment Authority, the second highest bid came from Soilbuild Group Holdings at almost S$25.1 million.
This is followed by a S$21.6 million offer put in by Whye Wah Group.
All in, the 60-year leasehold site attracted seven bids, with the remaining bids ranging between about S$13.4 million and S$21 million.
The 1.42-hectare land parcel has a maximum gross plot ratio of 2.5.
It can be developed for a variety of uses under “Business 1″ zoning.
Li Hiaw Ho, executive director of CBRE Research, said the healthy interest shown for the site could be due to the current shortage of industrial land in Yishun.
He said: “No sites in Yishun were awarded under the government land sales programme in the last 10 years. The latest transaction for industrial buildings located at Yishun took place in November 2007. This was the sale of 61 Yishun Industrial Park A to MacarthurCook Industrial REIT for S$24.6 million.”
CBRE added that a more positive business sentiment could have also played a part in the robust response to the tender.
Mr Li said: “Manufacturing output for February 2010 showed a growth of 19.1 per cent, a reverse from the contraction of 12.5 per cent a year ago.”
Source : Channel NewsAsia – 6 Apr 2010
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