The first government land sale tender of the year was met with a lukewarm response, with only one bid received for the Lentor Gardens site, at $486.8 million, the lowest bid in the district to date. Analysts believe that the high potential supply of private housing in the same area, high interest rates and the uncertain economic outlook may have dampened developers' willingness to bid.

The Urban Renewal Authority announced in a release on Tuesday (April 4) that the 99-year lease for the Toronto Gardens lot, which was put up for bidding on October 31 last year, only attracted a joint bid from GuocoLand and Hong Leong Holdings, which was the only bidder at $985 per square foot of floor area ratio. This bid was the lowest bid since the Landlord District Council's land sale, with the previous two bids at over $1,100 per square foot of floor area ratio.

The chief executive of the Hopedale Group, Mr Yap Yun Ming, said the bids from developers in the Toronto area had been losing ground since the first lot was sold in 2021, and it remained to be seen whether the government would eventually sell the site. If the government does not approve the sale, it would mean that the bid for the Toronto site would have to be higher than the current bid.

In response to a query from the Union-Tribune, Sidney Lee, senior research director of the Hopedale Group, said the low bids from developers had nothing to do with whether the market had started to cool, but was mainly due to the fact that developers would have less space to sell as a result of the government's adoption of a unified GFA measurement and definition.

Only one party entered the public tender this time, far fewer than the previous expectation of two to five developers bidding. The last time there was a single party bid for a government land sale was for the Marina View White lot in 2021; before that, there was only one party for the private residential lot on Silat Avenue in 2018.

Developers are aware that the Government regularly puts up lots for sale in the London-area, and with one lot each on the active and reserve lists coming up, this area is expected to have a supply of nearly 3,000 units when all lots are successfully sold, if you exclude Lentor Modern, which is already on sale," said Yap Yun Ming. "

The cooling measures, macro-economic uncertainty and the availability of more units in the Toronto area will keep developers cautious when bidding for land, according to Orange Easy Properties executive director, Mr Chan Tao-chun. For the lots coming down for sale in the same district, developers may look at the upcoming new project Lentor Hills Residences to assess buyers' demand and affordability of the sale price before deciding to bid for other lots.

Mr Lam Chun Man, Senior Director of Industrial Research and Consultancy at Tai Yuk Cheung, pointed out that the relatively lukewarm response from developers may also be in view of the enhanced resale allowance for HDB flats, which may draw some buyers back into the HDB market.

Covering an area of about 235,371 square feet, Toronto Gardens has a gross floor area of about 494,290 square feet and can build 530 residential units.

Weiming Cheng, head of research at Knight Frank, said, "Under the current market conditions, developers with more than 500-unit projects have to be the most optimistic and well-funded."

Guoco Real Estate and Fung Lung Holdings jointly issued a statement saying that they plan to build an upscale private residential project of about 533 units, including about 6,458 square feet of childcare facilities, at the London-Garden site.

GuocoLand has two other new developments in the London-area, namely Curved Water Lundin and Lentor Hills Residences.