Singapore
Commentary on the GLS 2H 2024 - 7% less housing supply; Long Stay Serviced Apartment (SA2) takes a backseat
June 25, 2024
Associated Contact
Melvin Lin
Head of Marketing & Communications, Singapore
By Tricia Song (宋明蔚), Head of Research, Southeast Asia, CBRE
Pause in ramping up supply after weak land tenders and developer sales
The latest Government Land Sale (GLS) program saw the government pause on ramping up the residential supply on the confirmed list. The Government will be releasing 9 residential sites and one commercial and residential site which can yield a total of 5,050 units, down 7% from the 5,450 units over similar number of 9 residential sites and one commercial and residential site in 1H 2024 GLS Confirmed List. This is the first pause after seven consecutive increases since the trough of 1,390 units in the Confirmed List in 2H 2020, and 1H 2024 was the highest since 5,960 units in 2H 2013 Confirmed List. We believe the pause in ramping up supply is wise to prevent an over-supply, considering the lacklustre response in the recent land tenders and decade-low developer sales. Nonetheless, total supply of 11,110 private residential units in 2024 (including 610 units from the activated Reserve List site i.e. Zion Road Parcel B to close 18 July 2024) will be the highest supply introduced in a single year since 2013.
Excluding 560 EC units, 2H 2024 GLS list would translate into about 8,980 private homes on an annualised basis, higher than 2023’s 6,421 developer sales (excluding ECs), and on par with the 2014-2023 10-year average developer sales of 8,853 units. This should provide ample future land banking opportunities for developers and satisfy the resilient demand and hopefully stabilise prices.
No more new long-stay Serviced Apartment (SA2) sites, all residential sites offer palatable 240-580 units
After the Upper Thomson Road (Parcel A) tender closed with no bids on 19 June, likely due to the inclusion of Long Stay Serviced Apartments (SA2) component, we note that there are no new SA2 site additions on the 2H 2024 GLS list. In the 1H24 GLS list, a third SA2 site at one-north was offered on the Confirmed List and tender will close on 19 Sep. This will be the first full SA2 only site with a potential yield of 515 Serviced Apartments. A fourth SA2 site, at River Valley Green (Parcel B) on 1H 2024’s GLS Reserve List has been moved to Confirmed List for 2H 2024, with less stringent requirements, stipulating that “a portion of the GFA for the site will be allowed for Serviced Apartments use (estimated 220 SA units)”, out of a total 580 dwelling units.
In view of poor response to large sites especially those over 600 units, we note the sites offered this time round have more palatable quantum, which should mitigate developer risks of not being able to sell out within 5 years and incurring hefty ABSD of 35%.
First mixed-use development in new Chencharu estate, on the Confirmed List
In March 2024, a new housing estate offering around 10,000 homes in the Chencharu area in Yishun was unveiled, with its first public housing project recently launched in HDB’s June 2024 BTO exercise. Concurrently, in this 2H 2024 GLS, a mixed-use commercial and residential development appears on the Confirmed List. Slated to launch in Sep 2024, this site offers 875 private homes, and up to 13,000 sqm of retail space, with integrated community and bus interchange facilities.
With 875 dwelling units, this is the largest housing site in 2H24, but should be fairly popular due to its proximity to Khatib MRT station and the lack of private housing supply in the locality. The most recent comparable is Wisteria Mall and The Wisteria condo at Yishun Ring Road/Yishun Avenue 4, also a mixed-use development, was tendered in Jan 2015 and received 5 bids with a top bid of S$629 psf ppr.
No new commercial and hotel supply
In anticipation of the results for the 6.5ha white site in the Jurong Lake District closed in March 2024, there continues to be no new commercial or hotel supply on the GLS. The White site on the Confirmed List in 1H23 GLS – Marina Gardens Crescent, which was not awarded when tender closed in Jan 2024, has been placed in the Reserve List. The White site for a mixed-use development at Woodlands Avenue 2, the short-term lease commercial site at Punggol Walk, and the hotel site at River Valley Road will be carried over from the 1H 2024 Reserve List to the 2H 2024 Reserve List.
Source: CBRE Research, MND. Resi: Residential. CL: Confirmed List. RL: Reserve List.
Which are the most attractive new sites on GLS 2H 2024?
There are 9 residential sites on the Confirmed List, of which 5 are new and 4 are carried over from 1H 2024’s Reserve List. They are well spread-out and offer a diversity of sites to suit different budgets and needs. However there are no standout sites -- some are near MRT stations or within 1km from popular schools. We find the most attractive sites to be Tampines St 95 (EC), Bayshore Road, Chuan Grove and Faber Walk.
There are also quite a number of prime or downtown sites including Holland Link and River Valley Green Parcel B in the Confirmed List, and Holland Plain and River Valley Green Parcel C, Marina Gardens Lane and Marina Gardens Crescent (white site) in the Reserve List. We expect response to them to be lukewarm, as evidenced from recent tenders in Holland Drive, River Valley Parcel A, Zion Road Parcel A, Orchard Boulevard and Marina Gardens Crescent. This is due to these sites’ high price points and investor or foreigner focus - market segments hit hard by hikes in ABSD in April 2023.
Given the ample supply in the Confirmed List and lack of standout sites, we believe the Reserve List sites are unlikely to be triggered.
Details
ECs by itself is popular due to its affordability. The only EC on the Confirmed List, Tampines St 95 EC is also within walking distance from Tampines West (Downtown Line) MRT, near a mixed-use development to be tendered, and within 1km from St Hilda’s Primary School.
Bayshore Road site, adjacent from Costa del Sol, on top of the future Bayshore MRT station, with 515 units buildable, was carried over from Reserve List 1H 2024. As Bayshore MRT on the Thomson-East Coast Line has become operational as of 23 June 2024, the Bayshore waterfront estate is taking shape and becomes more accessible.
Chuan Grove is near the Lorong Chuan MRT station, New Tech Park and the Australian International School. Chuan Park. Developers could take the cue from nearby upcoming new launch of the collective sale of Chuan Park in the later 2024. Chuan Park was sold for S$890 million in 2022, or a land rate, which includes an estimated upgrading premium of S$165 million of S$1,254 psf ppr based on reports.
While Faber Walk is not particularly near any MRT station, it is within 1km from popular Nan Hua Primary School, and a short drive away from business hubs such as Jurong Lake District, Science Parks and one-north Business Park. It also has a palatable size of 400 units and could enjoy scenic waterfront views in a low-rise landed estate. Projects in Clementi and West Coast area have fared well historically.
Event and details:
2024 private housing supply highest since 2013 with latest 2H2024 Government Land Sales (GLS) Programme
The Government today announced the Government Land Sales (GLS) Programme for 2H2024, which comprises ten Confirmed List sites and nine Reserve List sites. Together, these sites can yield about 8,140 private residential units, 113,650 sqm gross floor area (GFA) of commercial space and 530 hotel rooms.
The Confirmed List comprises nine private residential sites (including one EC site) and one commercial & residential site, which can collectively yield about 5,050 private residential units (including 560 EC units) and 14,300 sqm GFA of commercial space.
The Reserve List comprises five private residential sites (including two EC sites), one commercial site, two White sites and one hotel site. These sites can potentially yield an additional 3,090 private residential units (including 730 EC units), 99,350 sqm GFA of commercial space and 530 hotel rooms.
The Government will continue to release a steady supply of private housing in future GLS programmes to cater to demand, with supply calibrated every six months to account for prevailing economic and property market conditions.
PROPOSED RESIDENTIAL, COMMERCIAL AND HOTEL SITES FOR 2H2024 GLS PROGRAMME
(1) The estimated number of dwelling units (DU) for Executive Condominium and private residential sites takes into account the average unit sizes of recent comparable developments and prevailing Development Control guidelines.
(2) New sites introduced in 2H2024.
(3) Site has a DU cap of 403 residential units.
(4) Site is required to provide a minimum 600 sqm GFA for childcare centre.
(5) A portion of the GFA for the site will be allowed for Serviced Apartments use (estimated 220 SA units). Site has a retail cap of 500 sqm GFA.
(6) Sites have a retail cap of 400 sqm GFA.
(7) Sites have a retail cap of 400 sqm GFA.
(8) Site has a DU cap of 242 residential units.
(9) A mixed-use development with integrated community and bus interchange facilities (estimated 8,500 sqm GFA) at GPR of 3.26. Retail cap is 13,000 sqm GFA.
(10) Site has a DU cap of 279 residential units and is required to provide a minimum 500 sqm GFA for childcare centre.
(11) Site is required to provide a minimum office quantum of 8,400 sqm GFA and a minimum 650 sqm GFA for childcare centre.
(12) Site has a retail cap of 6,000 sqm GFA and is required to provide a minimum 500 sqm GFA for childcare centre.
(13) Site has a retail cap of 33,000 sqm GFA and is required to provide a minimum office quantum of 45,000 sqm GFA.
(14) Site has a retail cap of 2,000 sqm GFA.
(15) Refers to estimated date the detailed conditions of sale will be available, and applications can be submitted.
Pause in ramping up supply after weak land tenders and developer sales
The latest Government Land Sale (GLS) program saw the government pause on ramping up the residential supply on the confirmed list. The Government will be releasing 9 residential sites and one commercial and residential site which can yield a total of 5,050 units, down 7% from the 5,450 units over similar number of 9 residential sites and one commercial and residential site in 1H 2024 GLS Confirmed List. This is the first pause after seven consecutive increases since the trough of 1,390 units in the Confirmed List in 2H 2020, and 1H 2024 was the highest since 5,960 units in 2H 2013 Confirmed List. We believe the pause in ramping up supply is wise to prevent an over-supply, considering the lacklustre response in the recent land tenders and decade-low developer sales. Nonetheless, total supply of 11,110 private residential units in 2024 (including 610 units from the activated Reserve List site i.e. Zion Road Parcel B to close 18 July 2024) will be the highest supply introduced in a single year since 2013.
Excluding 560 EC units, 2H 2024 GLS list would translate into about 8,980 private homes on an annualised basis, higher than 2023’s 6,421 developer sales (excluding ECs), and on par with the 2014-2023 10-year average developer sales of 8,853 units. This should provide ample future land banking opportunities for developers and satisfy the resilient demand and hopefully stabilise prices.
No more new long-stay Serviced Apartment (SA2) sites, all residential sites offer palatable 240-580 units
After the Upper Thomson Road (Parcel A) tender closed with no bids on 19 June, likely due to the inclusion of Long Stay Serviced Apartments (SA2) component, we note that there are no new SA2 site additions on the 2H 2024 GLS list. In the 1H24 GLS list, a third SA2 site at one-north was offered on the Confirmed List and tender will close on 19 Sep. This will be the first full SA2 only site with a potential yield of 515 Serviced Apartments. A fourth SA2 site, at River Valley Green (Parcel B) on 1H 2024’s GLS Reserve List has been moved to Confirmed List for 2H 2024, with less stringent requirements, stipulating that “a portion of the GFA for the site will be allowed for Serviced Apartments use (estimated 220 SA units)”, out of a total 580 dwelling units.
In view of poor response to large sites especially those over 600 units, we note the sites offered this time round have more palatable quantum, which should mitigate developer risks of not being able to sell out within 5 years and incurring hefty ABSD of 35%.
First mixed-use development in new Chencharu estate, on the Confirmed List
In March 2024, a new housing estate offering around 10,000 homes in the Chencharu area in Yishun was unveiled, with its first public housing project recently launched in HDB’s June 2024 BTO exercise. Concurrently, in this 2H 2024 GLS, a mixed-use commercial and residential development appears on the Confirmed List. Slated to launch in Sep 2024, this site offers 875 private homes, and up to 13,000 sqm of retail space, with integrated community and bus interchange facilities.
With 875 dwelling units, this is the largest housing site in 2H24, but should be fairly popular due to its proximity to Khatib MRT station and the lack of private housing supply in the locality. The most recent comparable is Wisteria Mall and The Wisteria condo at Yishun Ring Road/Yishun Avenue 4, also a mixed-use development, was tendered in Jan 2015 and received 5 bids with a top bid of S$629 psf ppr.
No new commercial and hotel supply
In anticipation of the results for the 6.5ha white site in the Jurong Lake District closed in March 2024, there continues to be no new commercial or hotel supply on the GLS. The White site on the Confirmed List in 1H23 GLS – Marina Gardens Crescent, which was not awarded when tender closed in Jan 2024, has been placed in the Reserve List. The White site for a mixed-use development at Woodlands Avenue 2, the short-term lease commercial site at Punggol Walk, and the hotel site at River Valley Road will be carried over from the 1H 2024 Reserve List to the 2H 2024 Reserve List.
Which are the most attractive new sites on GLS 2H 2024?
There are 9 residential sites on the Confirmed List, of which 5 are new and 4 are carried over from 1H 2024’s Reserve List. They are well spread-out and offer a diversity of sites to suit different budgets and needs. However there are no standout sites -- some are near MRT stations or within 1km from popular schools. We find the most attractive sites to be Tampines St 95 (EC), Bayshore Road, Chuan Grove and Faber Walk.
There are also quite a number of prime or downtown sites including Holland Link and River Valley Green Parcel B in the Confirmed List, and Holland Plain and River Valley Green Parcel C, Marina Gardens Lane and Marina Gardens Crescent (white site) in the Reserve List. We expect response to them to be lukewarm, as evidenced from recent tenders in Holland Drive, River Valley Parcel A, Zion Road Parcel A, Orchard Boulevard and Marina Gardens Crescent. This is due to these sites’ high price points and investor or foreigner focus - market segments hit hard by hikes in ABSD in April 2023.
Given the ample supply in the Confirmed List and lack of standout sites, we believe the Reserve List sites are unlikely to be triggered.
Details
ECs by itself is popular due to its affordability. The only EC on the Confirmed List, Tampines St 95 EC is also within walking distance from Tampines West (Downtown Line) MRT, near a mixed-use development to be tendered, and within 1km from St Hilda’s Primary School.
Bayshore Road site, adjacent from Costa del Sol, on top of the future Bayshore MRT station, with 515 units buildable, was carried over from Reserve List 1H 2024. As Bayshore MRT on the Thomson-East Coast Line has become operational as of 23 June 2024, the Bayshore waterfront estate is taking shape and becomes more accessible.
Chuan Grove is near the Lorong Chuan MRT station, New Tech Park and the Australian International School. Chuan Park. Developers could take the cue from nearby upcoming new launch of the collective sale of Chuan Park in the later 2024. Chuan Park was sold for S$890 million in 2022, or a land rate, which includes an estimated upgrading premium of S$165 million of S$1,254 psf ppr based on reports.
While Faber Walk is not particularly near any MRT station, it is within 1km from popular Nan Hua Primary School, and a short drive away from business hubs such as Jurong Lake District, Science Parks and one-north Business Park. It also has a palatable size of 400 units and could enjoy scenic waterfront views in a low-rise landed estate. Projects in Clementi and West Coast area have fared well historically.
Event and details:
2024 private housing supply highest since 2013 with latest 2H2024 Government Land Sales (GLS) Programme
The Government today announced the Government Land Sales (GLS) Programme for 2H2024, which comprises ten Confirmed List sites and nine Reserve List sites. Together, these sites can yield about 8,140 private residential units, 113,650 sqm gross floor area (GFA) of commercial space and 530 hotel rooms.
The Confirmed List comprises nine private residential sites (including one EC site) and one commercial & residential site, which can collectively yield about 5,050 private residential units (including 560 EC units) and 14,300 sqm GFA of commercial space.
The Reserve List comprises five private residential sites (including two EC sites), one commercial site, two White sites and one hotel site. These sites can potentially yield an additional 3,090 private residential units (including 730 EC units), 99,350 sqm GFA of commercial space and 530 hotel rooms.
The Government will continue to release a steady supply of private housing in future GLS programmes to cater to demand, with supply calibrated every six months to account for prevailing economic and property market conditions.
PROPOSED RESIDENTIAL, COMMERCIAL AND HOTEL SITES FOR 2H2024 GLS PROGRAMME
|
S/N |
Location |
Site Area (ha) |
Proposed GPR |
Estimated No. of Residential Units (1) |
Estimated No. of Hotel Rooms |
Estimated Commercial Space (m2) |
Estimated Launch Date |
Sales Agent |
|
Confirmed List |
||||||||
|
Residential Sites |
||||||||
|
1 |
2.25 |
2.5 |
560 |
0 |
0 |
Aug 2024 |
HDB |
|
|
2 |
2.58 |
1.4 |
400 |
0 |
0 |
Sep 2024 |
URA |
|
|
3 |
2.06 |
2.1 |
500 |
0 |
0 |
Oct 2024 |
URA |
|
|
4 |
1.17 |
3.5 |
580 |
0 |
500 |
Oct 2024 |
URA |
|
|
5 |
1.05 |
4.2 |
515 |
0 |
0 |
Nov 2024 |
URA |
|
|
6 |
0.81 |
3.7 |
345 |
0 |
400 |
Nov 2024 |
URA |
|
|
7 |
0.97 |
4.3 |
485 |
0 |
400 |
Nov 2024 |
URA |
|
|
8 |
1.58 |
3.0 |
550 |
0 |
0 |
Dec 2024 |
URA |
|
|
9 |
1.72 |
1.4 |
240 |
0 |
0 |
Dec 2024 |
URA |
|
|
Commercial & Residential Sites |
||||||||
|
10 |
2.94 |
3.2 |
875 |
0 |
13,000 |
Sep 2024 |
HDB |
|
|
|
Total (Confirmed List) |
5,050 |
0 |
14,300 |
|
|
||
|
S/N |
Location |
Site Area (ha) |
Proposed GPR |
Estimated No. of Residential Units (1) |
Estimated No. of Hotel Rooms |
Estimated Commercial Space (m2) |
Estimated Available Date (15) |
Sales Agent |
|
Reserve List |
||||||||
|
Residential Sites |
||||||||
|
1 |
1.01 |
3.0 |
295 |
0 |
0 |
Available |
HDB |
|
|
2 |
0.61 |
5.6 |
400 |
0 |
0 |
Oct 2024 |
URA |
|
|
3 |
2.58 |
1.7 |
435 |
0 |
0 |
Oct 2024 |
HDB |
|
|
4 |
1.58 |
1.8 |
275 |
0 |
0 |
Dec 2024 |
URA |
|
|
5 |
1.15 |
3.5 |
470 |
0 |
0 |
Dec 2024 |
URA |
|
|
Commercial Sites |
||||||||
|
6 |
1.00 |
1.4 |
0 |
0 |
13,350 |
Available |
URA |
|
|
White Sites |
||||||||
|
7 |
1.73 |
4.2 |
775 |
0 |
6,000 |
Available |
URA |
|
|
8 |
2.75 |
4.2 |
440 |
0 |
78,000 |
Available |
URA |
|
|
Hotel Sites |
||||||||
|
9 |
1.02 |
2.8 |
0 |
530 |
2,000 |
Available |
URA |
|
|
|
Total (Reserve List) |
3,090 |
530 |
99,350 |
|
|
||
|
|
Total (Confirmed List and Reserve List) |
8,140 |
530 |
113,650 |
|
|
||
(1) The estimated number of dwelling units (DU) for Executive Condominium and private residential sites takes into account the average unit sizes of recent comparable developments and prevailing Development Control guidelines.
(2) New sites introduced in 2H2024.
(3) Site has a DU cap of 403 residential units.
(4) Site is required to provide a minimum 600 sqm GFA for childcare centre.
(5) A portion of the GFA for the site will be allowed for Serviced Apartments use (estimated 220 SA units). Site has a retail cap of 500 sqm GFA.
(6) Sites have a retail cap of 400 sqm GFA.
(7) Sites have a retail cap of 400 sqm GFA.
(8) Site has a DU cap of 242 residential units.
(9) A mixed-use development with integrated community and bus interchange facilities (estimated 8,500 sqm GFA) at GPR of 3.26. Retail cap is 13,000 sqm GFA.
(10) Site has a DU cap of 279 residential units and is required to provide a minimum 500 sqm GFA for childcare centre.
(11) Site is required to provide a minimum office quantum of 8,400 sqm GFA and a minimum 650 sqm GFA for childcare centre.
(12) Site has a retail cap of 6,000 sqm GFA and is required to provide a minimum 500 sqm GFA for childcare centre.
(13) Site has a retail cap of 33,000 sqm GFA and is required to provide a minimum office quantum of 45,000 sqm GFA.
(14) Site has a retail cap of 2,000 sqm GFA.
(15) Refers to estimated date the detailed conditions of sale will be available, and applications can be submitted.
About CBRE Group, Inc.
CBRE Group, Inc. (NYSE:CBRE), a Fortune 500 and S&P 500 company headquartered in Dallas, is the world’s largest commercial real estate services and investment firm (based on 2024 revenue). The company has more than 140,000 employees (including Turner & Townsend employees) serving clients in more than 100 countries. CBRE serves a diverse range of clients with an integrated suite of services, including facilities, transaction and project management; property management; investment management; appraisal and valuation; property leasing; strategic consulting; property sales; mortgage services and development services. Please visit our website at www.cbre.com.