Press Release

December 08, 2022

Government Ramps Up Private Housing Supply For First Half Of 2023 (1H2023) Amid Sustained Demand For New Private Housing

8 December 2022, SINGAPORE – The government has today announced its public land sales slate for 1H2023 which sees a further ramping up of the supply of private housing on the Confirmed List – this is the fifth straight increase in the number of residential units offered in the Confirmed List under its half-yearly government land sales (GLS) programme.

The upcoming GLS programme will feature 7 Confirmed List sites that will collectively offer 4,090 residential units (including 700 executive condo units) and 106,400 sqm gross floor area (GFA) of commercial space. Notably, this is the largest number of residential units offered under the Confirmed List since 1H 2014, where 4,630 units were put up (see Chart 1). The upcoming Confirmed List residential supply is 16.7% higher than the 3,505 units offered in 2H 2022, and 46.9% more than the 2,785 units in 1H 2022.

The 1H 2023 GLS slate features several new sites in both the Confirmed and Reserve Lists. Four of the 7 Confirmed List sites are newly introduced - residential sites in Champions Way and Media Circle, and two white sites in Marina Gardens Crescent and Jurong Lake District. The other 3 Confirmed List sites are in Jalan Tembusu, Lentor Central, and an EC plot in Tampines Street 62 (Parcel B), which is next to the recently launched Tenet EC. Slightly more than half of the residential units (including ECs) in the 1H 2023 land supply are in the Outside Central Region (see Table 1).

Meanwhile, the Reserve List - which comprises 9 sites – can jointly yield 3,625 residential units (including 855 EC units), 530 hotel rooms, and 93,350 sqm GFA of commercial space. Four of the sites are newly introduced, being Lentor Gardens, Lorong 1 Toa Payoh, Plantation Close (EC), and a short-term lease commercial site in Punggol Walk which will have a 30-year lease tenure. The remaining Reserve List sites are in Pine Grove (Parcel B), Clementi Avenue 1, Senja Close (EC), Woodlands Avenue 2 (white site), and River Valley Road (hotel site).

Taken together, 1H 2023 GLS will offer 7,715 residential units, 530 hotel rooms, and 199,750 sqm GFA of commercial space across a wide spread of locales under the Confirmed and Reserve Lists. The amount of commercial space offered is the largest since 2H 2016.

A key highlight of the 1H 2023 GLS is the mega 6.8-hectare white site – comprising 3 land plots linking the Jurong East MRT interchange station to the future Jurong Lake District station on the Cross Island Line. This plot will kickstart the next phase of development in the Jurong Lake District (JLD) and will be developed under the master developer approach. The proposed integrated development on the white site will be developed over the next 5 to 10 years to cater to market demand. The government said that the successful tenderer will be required to build at least 70,000 sqm GFA of office space and 600 private housing units as part of the first phase of the development, but will have some flexibility to phase out the remaining supply according to market demand.

Ismail Gafoor, CEO of PropNex Realty:
“The move to ramp up GLS residential supply – the largest number of dwelling units under the Confirmed List since 1H 2014 - is in tune with market needs as private housing demand has outpaced the unsold stock in the past year. However, we had hope that more OCR sites would be offered under the Confirmed List as this sub-market faces a sharper supply and demand imbalance. As of Q3 2022, there were just 3,417 unsold uncompleted units (ex. EC) in the OCR – way below the annual average new home sales of about 6,600 OCR units between 2011 and 2021. The average transacted unit price of new non-landed private homes (ex. EC) in the OCR has breached the $2,000-psf mark in Q3 2022, and we think a larger injection of housing supply in the OCR could help to keep prices stable.

Given the limited launches this year, we expect there will be some pent-up demand for new launches in 2023 and this fresh slate of GLS sites will allow developers to top up their land inventory. The 1H 2023 land slate is reflective of the government’s effort to inject more vibrancy and to grow the population catchment in areas such as Lentor, in Mediapolis, and the up-and-coming Marina South precinct.

We are also excited about the white site in JLD which will act as a catalyst for the next phase of transformation in the precinct, and indeed for Singapore as it spurs new economic activities and adds more jobs and homes to the area. The government has opted for a master developer approach to developing the site and we think this will likely see a two-envelope tender system where design and concept, in addition to the price tendered will be used in its sale.

Given the government’s planning and development objective to transform the JLD into Singapore’s largest business district outside the city centre, we think the master developer approach is apt and will give the successful developer some flexibility in phasing out the site’s development over time in accordance with market demand, garner economies of scale (given the bulk procurement of supplies and services) and drive productivity gains over a large-scale urban regeneration project. The JLD site will attract large real estate players that have a strong track record in project development, financial credibility, and long-term vision.

Developers will have a good choice of sites offered under the 1H 2023 GLS ranging from the white sites in Marina Gardens Crescent and Jurong Lake District – which will have a large land price quantum and risks that come with more sizable development – to smaller land parcels in Media Circle and Champions Way. The Reserve List also provides opportunities for developers to trigger sites for sale should there be a demand. We note that the government has placed a short-term lease commercial site at Punggol Walk, which has a 30-year lease tenure and a potential to yield about 8,400 sqm of office space in a bid to support decentralisation and demand for workspaces near homes. Despite the shorter lease, we anticipate that the Punggol Walk plot should garner keen interest owing to the lack of commercial office space in that area.”