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|No. of Rooms||Unit Type||Size (sqft)||Price From||Units Available|
GLS Tender of The Reserve Residences Site
|Ranking||Name of Tenderer||Tendered Sale Price ($)||Tendered Sale Price Psf Ppr ($)|
|1||FE Landmark Pte. Ltd., FEC Residences Trustee Pte. Ltd. (in its capacity as Trustee-Manager of FEC Residences Trust) and FEC Retail Trustee Pte. Ltd. (in its capacity as Trustee-Manager of FEC Retail Trust)||$1,028,333,333.00||989|
|2||Perpetual (Asia) Limited (in its capacity as trustee of Mercatus Commercial Trust I) and Winchoice Investment Pte. Ltd.||$1,011,000,000.00||953|
|3||Dragon Commercial Pte. Ltd. and Dragon Residential Pte. Ltd.||$808,999,999.99||762|
The GLS for the land parcel at Jalan Anak Bukit was closed on Jun 29 2021 and awarded to FE Landmark Pte. Ltd., FEC Residences Trustee Pte. Ltd. (in its capacity as Trustee-Manager of FEC Residences Trust) and FEC Retail Trustee Pte. Ltd. (in its capacity as Trustee-Manager of FEC Retail Trust) – Far East Organization and Sino Group.
The Concept and Price Revenue Tender had received 3 tenderers’ bid with a total of 5 Concept Proposals; 3 submitted by Far East Organization and Sino Group. The site was eventually awarded to Far East Organization and Sino Group with the highest bid of $1,028,333,333.
The 99-year leasehold mixed-use site has a size of 3.22Ha land, with a plot ratio of 3.0, translating the top bid to a $989 psf ppr.
URA has mentioned of the winning bid “Overall, the concept proposal is compelling in its well-considered site planning, design response to tropical climate and integration of the various uses and public spaces”
CEO of Orange Tee & Tie also commented that the demand for the land parcels are healthy. He added on that “As the sizes of the parcels are not large, developers may have been attracted by the lower risks and costs involved. The land parcels are situated near MRT stations with ample amenities. Further, developers may have confidence that the projects will be well received when launched for sale since there is limited supply in the area. Moreover, projects in the vicinity are either fully or substantially sold.”
The Reserve Residences Estimated Launch Price/Indicative Price
|The Reserve Residences||psf ($)|
|Expense and Profit Margin||402|
|Estimated Launch Price||1875|
Kindly take note the above is merely an Indicative Price. It is not the final Selling Price.
How is the launch price estimated?
Far East Organization and Sino Group build houses and sell them as their business, and they need to generate profits for their shareholders as well. In estimated the launch price for The Reserve Residences, we need to consider the costs, expenses and the profit margin, before we can arrive at the selling price.
As mentioned above, the land was acquired through the GLS tender at $989 psf ppr. That will comprise the main bulk of the total costs.
Generally, the construction costs for a mass market condominium like The Reserve Residences is about $350 psf.
Expense and Profit Margin
Construction cost + Land Cost = Base Cost
Base Cost = $989 psf + $350 psf = $1339 psf
Once we have the base cost, we can now calculate the expense and profit margin, which is about 30% of the base cost.
Expense and Profit Margin = 40% x $1339 psf = $536 psf
The expense and profit margin will mainly covers
- administrative expenses such as staffing
- sales and marketing expenses such as the agency commissions
- finance costs that need to be paid to financial institutions
- profit margin which is the profit the developer makes for the development
With all the costs and expenses covered, we can now estimate the launch price to be about $1,875. However, kindly take note that the price psf will vary too depending on the size of the unit etc. Generally, a smaller size unit will have a higher psf as compared to a bigger size unit.
(All prices for Reserve Residences displayed here are for reference purposes. Prices are subject to change from time to time without prior notice. This webpage cannot be held responsible for any pricing inaccuracies, omissions and/or dispute.)
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