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| | | | | | | There has been aggressive bidding for the Somerset Central site.
By the close of the tender on Wednesday, there were 5 bids for the 7,311 square metre site.
The top bid of S$617.2 million, or $1,455 per square foot, was submitted by Australia's Lend Lease.
Over the past few months, the residential sector hogged the headlines with record-selling home prices.
But on Wednesday, it was the retail sector that's stealing the spotlight.
The Somerset Central site, above the Somerset MRT station, garnered a top bid of $1,455 per square foot.
This is a staggering 34 percent above the first Somerset site sold in January this year - and 43 percent higher than the Orchard Turn site, awarded in December last year.
And even the lowest bid of $1,168 per square foot for Somerset Central is higher than the winning bid for the first Somerset site - by some 8 percent.
However analysts say the premium may be justified.
Chua Yang Liang, Head of Research - Singapore, Jones Lang LaSalle, said: "This site is very prime location - it is right above the Somerset MRT station, just like the Orchard Turn site. It faces one of the busiest pedestrian crossing along Orchard Road. As such, this site with its regular site area and a great frontage coming out of Orchard Road and Cairnhill makes it a rare location. This is the last remaining parcel in Orchard Road, it makes it very attractive to developers.
There were five bids in all, compared to six for the first Somerset site and eight for Orchard Turn.
Consultants say fewer developers were willing to participate in the latest bidding game when capital values have risen so much so quickly.
But the real surprise was the emergence of Australia's Lend Lease - not just as a bidder for the site, but the top bidder.
Chua Yang Liang said: "Lend Lease's participation was kind of unexpected. Most of the market analysts were looking more at the other developers who have put up unsuccessful bids in the last two parcels. Lend Lease has been quite aggressive from Australia and it reflects their interest in this part of the region, the growing interest in our markets."
With a market capitalisation of close to A$6 billion, Lend Lease is a major property developer in Australia and was one of the pioneers of Real Estate Investment Trusts.
Lend Lease owns and manage the highly successful Parkway Parade mall in the East Coast. - CNA/ch
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