SINGAPORE — En-bloc fever continues to rage in the property market, with freehold development Changi Garden attracting a winning tender bid of S$248.8 million, which surprised analysts.

CEL Real Estate Development’s offer to buy over the estate is close to 30 per cent higher than the asking price, and analysts said that it was unexpected given that the mixed development, with residential and retail units, is not in a central location.

The estate, located at the junction of Upper Changi Road North and Jalan Mariam, comprises 60 apartments, 12 penthouses and 12 shops.

The property developer beat eight other bidders to win the tender. The purchase price works out to S$888 per square foot (psf) per plot ratio for the 200,093sqf site

Each apartment owner will net between S$2.14 million and S$2.27 million, while a penthouse owner will receive between S$4.03 million and S$4.74 million. Shop owners are expected to receive S$4.7 million to S$7.08 million.

Built between the 1970s and 1980s, Changi Garden was put up for collective sale last month with an asking price of S$196 million.

CEL Real Estate Development is a wholly owned subsidiary of mainboard-listed Chip Eng Seng Corporation. In a filing to the Singapore Exchange on Tuesday (Oct 1), Chip Eng Seng said that it intends to develop a low-rise residential condominium on the site, comprising around 320 units, with full facilities and possibly some retail shops.

Commenting on the sale, Mr Alan Cheong, senior director of research and consultancy at Savills Valuation and Professional Services, said that the property market is now in a “very unusual cycle”.

“In the past, developers focused on prime districts for collective sales, but today it is all over the island,” he said, noting that Changi Garden is located opposite Changi Prison.

“Also, the asking price is already considered high, but the developer is willing to bid even higher. This will translate to higher prices when the new development is launched,” Mr Cheong said.

Mr Eugene Lim, key executive officer of ERA Realty Network, said that prices of units at the future development would be dependent on market conditions.

On the sale price, he said: “The price reflects the confidence the developer has in the property market in the short term, that prices will increase.”

Mr Nicholas Mak, head of the research and consultancy department at integrated asset manager ZACD, said that the estimated break-even price for CEL, based on the current market condition, would be about S$1,350 psf to S$1,400 psf.

This year so far, there have been more than 10 collective sales, including Tampines Court, which went for a record high of S$970 million, the biggest sale for a former Housing and Urban Development Company estate since 2007.

Earlier this month, Normanton Park was sold for S$830.1 million, and the sale of Amber Park condominium at S$906.7 million set a record for Singapore’s largest freehold collective sale by dollar value.