The Government yesterday (27 June) announced the second half 2018 (2H2018) Government Land Sales (GLS) Programme, which comprised six Confirmed List sites and nine Reserve List sites to yield more private residential units.
These sites can yield up to 8,040 private residential units, 124,200 sqm gross floor area (GFA) of commercial space and 930 hotel rooms.
The six Confirmed List sites comprise four private residential sites [including one Executive Condominium (EC) site], one White site and one Hotel site which can yield 2,705 private residential units (including 695 EC units), 42,200 sqm GFA of commercial space and 390 hotel rooms.The Reserve List comprises seven private residential sites (including one EC site) and two White sites. These sites can yield 5,335 private residential units (including 515 EC units), 82,000 sqm GFA of commercial space and 540 hotel rooms.
The Ministry of National Development (MND) said there was a healthy supply of private housing in the pipeline. MND said that it expected around 20,000 units from GLS and en-bloc sale sites that are pending planning approval, on top of the 24,000 unsold units from projects with planning approval. In addition, more than 30,000 existing private housing units remain vacant.
It noted that there nevertheless continues to be strong demand for land from developers and that transaction volumes were also rising. The Government has therefore decided to keep the total supply of units for the 2H2018 GLS Programme at about the same level as the supply from the 1H2018 GLS Programme.
MND said that taken together, the total supply in the pipeline will be able to meet home buyers’ demand over the next 1 to 2 years, and to meet our population’s housing needs. The Government promised to continue to monitor the property market closely and adjust the supply from future GLS Programmes, when necessary.
The Government is also releasing a White site at Woodlands Square / Woodlands Avenue 2 on the Reserve List of the 2H2018 GLS Programme. This site will help to sustain the development momentum of Woodlands Regional Centre as a major commercial node outside the city, in line with the Government’s objective of decentralising employment centres to bring job opportunities closer to homes.
In 2017, Singapore registered a growth of 6.2% in International Visitor Arrivals to welcome 17.4 million visitors. With the favourable global economic outlook, the Singapore Tourism Board is optimistic about tourism prospects for Singapore in the next few years. The Government is releasing two new sites that can supply new hotel rooms at Club Street and Marina View via the 2H2018 GLS Programme. These sites will allow developers to provide additional hotel rooms to meet the expected growth in demand.
JLL, a prominent real estate services firm, tabulated URA’s announcement of the second half 2018 Government Land Sales (GLS) programme with the first half GLS programme for easy comparison, and to make the following points:
|Commercial||4,450 sqm||42,200 sqm|
|Commercial||59,510 sqm||82,000 sqm|
Source: URA/JLL research
In the 2H2018 confirmed list, there are only 3 private residential sites and a white site supplying 2,010 units, a 14% decline from the 2,325 units supplied by 5 private residential sites under the 1H2018 confirmed list. The moderation is probably due to concerns of oversupplying the market since the buoyant collective/en bloc sales market is generating the bulk of future supply. Between 2H2016 and 1H2018, GLS sites will generate about 30% of the units to be developed while some 70% will be from collective/enbloc sites.
The confirmed list private residential sites are at Kampong Java Road and Middle Road which are in the Core Central Region (CCR) and Sims Drive which is in Rest of the Central Region (RCR). There are no private residential sites in Outside Central Region (OCR) in the 2H2018 confirmed list although the white site at Pasir Ris will generate private residential units.
The focus of the 2H2018 residential GLS seems to be on the central region which accounts for 79% of collective sale sites sold in 1H2018 to-date. Although the three GLS sites could help to meet demand from developers, it is uncertain as to whether they will mitigate optimistic land prices. They are also unlikely to dilute demand for collective sale sites, especially those in the prime districts for which there is keen interest.
A white site at Pasir Ris Central has been included in the 2H2018 confirmed list, capable of generating 35,900 sqm of commercial space and 535 private residential units. Located next to the Pasir Ris MRT station and bus interchange, the development is slated to be a future major retail mall in the area.
Sites for office development remained absent in the confirmed list in spite of the continued strengthening of CBD office rents. The government is likely to be hoping for demand to spill into the decentralised market in an effort to bring job opportunities closer to homes. This is reflected in the placement of a white site capable of yielding minimally 50,000 sqm gross floor area of office space in Woodlands Square/Woodlands Avenue 2 in the Reserved List.
A site for hotel development (390 rooms) is in the 2H2018 confirmed list. The last time a site with a hotel component was included in the confirmed list of the GLS programme was 7 years ago in 2H2011. The current hotel site comes on at a time when the economy has improved, healthy tourist arrivals have been recorded and the Trump-Kim summit has been successfully hosted.”
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