Singapore authorities have rejected a bid by a group of top property firms to develop a new business district in the island’s west, after judging the price offered for the land unattractive.
The consortium had proposed a gross floor-area price of S$5,309 per square metre to develop a 6.5-hectare site in the Jurong Lake District. But the Urban Redevelopment Authority (URA) said the price was “assessed to be too low”, according to a statement on Friday.
The offer was chosen from two proposals submitted by the same group of developers.
The consortium includes CapitaLand Group, owned by the state investor Temasek Holdings; and the city-state’s largest listed developer City Developments Ltd. Others involved were Frasers Property Ltd and the Japanese firms Mitsubishi Estate Co and Mitsui Fudosan Co.
The move is a setback to efforts by the city-state to decongest its Central Business District, where office vacancies remain tight. But many of the top financial and technological firms that have flocked to the financial hub have shunned locations outside prestigious skyscrapers in the city, opting instead to downsize offices or locate their staff overseas.
At the same time, developers are starting to pull back from taking major risks or making pricey bids as the country’s heated residential market cools.
Another bid for a prime land site near the city centre was already rejected in February, while a housing site failed to attract any interest from developers for the first time in more than two decades in June.
The URA said the government remains committed to developing the site, which was envisioned to include business, residential and recreational space, and will continue to engage with industry stakeholders.
The land parcel will be placed on a so-called reserve list, allowing interested parties to trigger another bidding round if they meet a minimum price that is acceptable to authorities.