IOI Properties the sole bidder for Marina View white site
The tender for a state land parcel at Marina View which closed on 21 September drew just one sole bid. The sole bid of S$1.508b or $1,379 psf/plot ratio was submitted by a unit of IOI Properties Group, and was only S$101 more than the price which the group successfully applied for the site to be released for sale back in June 2021.
Industry players felt that the lack of participation by other developers was mainly because developers were wary of the large minimum requirement for a hotel on this site. The 0.78-hectare (about 84,000 sq ft) site can generate a maximum gross floor area of 1.09 mi on sq ft. Of this, at least 548,959 sq ft has to be for residential use and at least 279,861 sq ft for hotel use. The Urban Redevelopment Authority (URA) estimated that the site will have around 905 residential units and 540 hotel rooms. The project can have up to 21,528 sq ft for optional office space and up to 21,528 sq ft of space for other commercial uses (including retail and F&B).
Moreover, the huge total development cost estimated at S$2.3b as well as major uncertainty due to supply-chain disruptions and manpower shortages caused by the pandemic would raise the risk profile of this project.
Although there was only one bidder for the Marina View site, the URA awarded the site because it deemed the minimum price of S$1.508b for the land parcel as acceptable. The URA has stipulated a seven-year project completion period for the Marina View site, longer than the usual five years for a typical residential development site.
The relatively thin supply of private homes in the downtown should lend support to the residential component of the future Marina
View development. The challenge will likely be to get the unit mix right: smaller units with lower absolute price tags which appeal to local investors and singles or couples, and larger units that are popular with some wealthy foreign investors.
As for the hotel component, the hospitality sector may now be in the doldrums. But a new hotel that opens seven years from today may well be opening in an environment where international travel has resumed in full force. Not only that, this residential-cum-hotel development in the heart of downtown could potentially be the industry leader for wellness, energy efficiency and environmental sustainability.