The Urban Redevelopment Authority (URA) announced that the Hougang Avenue 2 residential site that was launched for tender recently fetched a top bid of $207.5 million.

The bid by MCL Land, was the highest of 7 bids put in by private developers. Frasers Centrepoint was the second highest bidder with its bid of $189 million.

The other bidders were Nam Hee Contractor & POH Marymount, Cove Residential, Guocoland Retail Management and Sim Lian Land.

Li Hiaw Ho, Executive Director, CBRE Research commented, “The site is situated at the junction of Hougang Avenue 2 and Yio Chu Kang Road, surrounded by mostly landed homes such as Park Villas and Princeton Vale. The apartment developments in the neighbourhood include Nouvelle Park, Toho Green and the soon-to-be completed Fontaine Parry. It is also close to the amenities in Hougang HDB estate. The site is about 10 minutes’ drive from either Hougang or Kovan MRT stations. URA has allowed the site to be developed into a low-rise condominium up to five storeys or three-storey landed homes. Demand could come from the surrounding HDB estate and private estate dwellers.”

“While the number of bids, at seven, is within expectations, the bid prices are fairly bullish. The top bid of $207.5 million or $456 psf/plot ratio will translate to a breakeven cost of about $780 to $800 psf for a low-rise condominium project. The new project could probably fetch around $900-$950 psf when launched in 2011. Units in recently launched new freehold apartment projects in the vicinity like D’Pavilion (50 units), Residences Botanique (81 units) and Wembly Residences (33 units) were sold at average prices of $930 psf, $1,000 psf and $870 psf between January and April 2010. Units in the 99-year leasehold Kovan Residences were sold at $900 on the average in the same period,” he offered.