Knight Frank Commentary | Tender Closing for Marina Gardens Lane GLS Site

The Marina Gardens Lane GLS tender drew just one bid from EL Development at S$450.1 million, which works out to about S$1,243 psf per plot ratio (ppr). This is below the S$1,400 to S$1,500 psf ppr range expected prior to the tender closing, and also represents a notable discount of 11.3% to the S$1,402 psf ppr achieved by the first Marina Gardens Lane site that was awarded in 2023. Should this parcel be awarded, this second Marina South project could launch at an average price of between S$2,700 psf and S$2,900 psf, depending on market conditions at launch and the eventual product positioning.

There was also only one bid, unlike the four bids in the previous 2023 tender, suggesting that most developers are not yet ready to place confidence into the undeveloped residential neighbourhood in the current season, preferring instead to reserve their gunpower for more established built-up residential neighbourhoods where upgrader and right-sizing homebuyer movement is more likely. Developers remain cautious towards Marina South despite the encouraging sales performance of One Marina Gardens.

Today’s result mirrors sentiments previously observed at the nearby Marina Gardens Crescent site (tender closed January 2024 with also a sole bid), which also struggled to garner competitive interest. A combination of ongoing construction cost pressures, the large future residential pipeline planned for Marina South, and uncertainty over the pace at which the district will mature could have contributed to the restrained response. The tender outcome suggests that developers are currently differentiating between confidence in Marina South's long-term vision and the more conservative pricing they are prepared to underwrite today.