OUE

OUE: A 99yr leasehold, suburban condo site near Potong Pasir MRT station was sold yday at $628 psfppr to Santarli Corp, a local construction group. The tender drew 13 bids, with the second highest bid by OUE just a shade under at 0.9% below. Santarli expects breakeven cost to be slightly above $1,000 for the project, which is likely to yield ~240 units, and have an ASP of ~$1,300psf. This Govt Land Sales tender is the third that OUE has participated in this year (first two saw OUE bidding 17% under top bid). StanChart continues to expect OUE to seek to divest its Orchard Road assets, which would require OUE to seek out new earnings drivers in the form of devt profits. Expects OUE to persist at mass market land tenders. Says OUE is currently top pick, with TP $3.22.