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SINO Land has set a new benchmark price of $1,540 psf per plot ratio (ppr) for a commercial/hotel site with its top bid of $165.8 million for a site at Collyer Quay. For hotel sites alone, Sino Land's bid far exceeds the $520 psf ppr paid by Hong Leong Group for a site at Mohamed Sultan Road in November. It is also more than the $1,455 psf ppr that Lend Lease paid for the Somerset Central mixed development site in August.

In a class of its own: Sino Land will build a luxury hotel on the site with 120 rooms facing the sea

Most analysts, however, believe that the Collyer Quay site cannot be easily compared with other recent property transactions.

Knight Frank director of research and consultancy Nicholas Mak said the Collyer Quay site is in 'a class of its own'. A substantial portion - including Clifford Pier and the former Customs Harbour Branch building - has been gazetted for conservation. He also pointed out that the site includes part of the water body surrounding it, making future construction complex.

Mr Mak attributed Sino Land's bullish bid to the Hong Kong-based sister company of Far East Organization wanting to 'safeguard' its position in the area, where it also owns The Fullerton hotel. This benchmark price could now be used as a 'reference' by planning authorities for future land sales in the area, including the site between Marina Bay Sands and the Business Financial Centre, although Mr Mak believes that it will not 'impact the prices of Marina Bay that much'.

Sino Land put in the top two bids of $165.8 million and $161.8 million out of the three bids that were shortlisted by the Urban Redevelopment Authority based on concept. Eight bids were received in the two-envelop system.

The third highest shortlisted bid was $108.3 million from Park Hotel Group - 35 per cent lower than the top bid.

In a statement released yesterday, Sino Land said: 'The development will complement our historical and international award winning Fullerton Hotel, OneFullerton and the Fullerton Water Boathouse.'

Sino Land will build a luxury hotel with 120 'full sea-view rooms' taking up 45 per cent of the total gross floor area (GFA) of 10,000 sq m (107,639 sq ft) with the rest going to F&B, retail and entertainment uses.

Park Hotel Group director Allen Law said that its bid had a substantially larger percentage of the GFA going towards hotel rooms. 'We want to build our hotel brand,' he said.

Indeed, Jones Lang LaSalle Hotels executive vice-president Chee Hok Yean said that someone whose bid includes a 200-room hotel would have not have been able to bid as high as Sino Land. 'You get better returns from commercial and retail space,' she added. Even so, Ms Chee expects that Sino Land will have to charge $400-$500 per night to make its hotel feasible.

David Ling, managing director of hospitality consultancy HVS International, who said that the price Sino Land paid is 'unprecedented', believes that the Hong Kong developer will probably focus on the F&B, retail and entertainment component too.

Mr Ling estimates that luxury hotel rooms should be around 60 sq m each. Sino Land however, said that about 4,500 sq m of the GFA will be for the hotel, which means that each room will only be 37.5 sq m big.