Singapore's Loyang Valley condo makes third bid at collective sale with lower reserve price of S$880 million
SINGAPORE: Loyang Valley condominium in Changi will be making a third attempt at a collective sale, with a reduced reserve price of S$880 million.
The lower reserve price, which is $100 million less than its last tender in 2022, 'reflects a realistic and achievable figure given current market conditions', said Terence Lian, head of investment sales for the appointed marketing agent, Huttons Asia.
In 2022, the collective sale committee initially proposed a reserve price of $880 million but raised it to $980 million after some owners sought higher returns. No bids were received when the tender closed on Dec 15 that year.
In May 2025, Lian and his team of property salespeople successfully obtained the requisite 80 per cent mandate to proceed with the collective sale.
The public tender for Loyang Valley is expected to launch on July 8 and close on Aug 26.
The 362-unit condominium in Changi, built in 1985, is a sprawling resort-style estate spanning 840,648 sq ft, with 56 years remaining on its 99-year lease.
This round marks a significant shift in seller expectations, noted Lian.
'Several factors have motivated owners to support the collective sale, including lease decay, ongoing maintenance issues associated with the ageing property, the opportunity to unlock asset value with a premium, and considerations related to legacy planning,' he said.
'The confirmed Cross Island Line's Loyang MRT station was factored into our analysis and positively influenced the site's future potential.'
At $880 million, the owner of the smallest two-bedroom unit of 1,001 sq ft stands to receive about $1.67 million, while the owner of the largest four-bedroom unit can get about $3.9 million, he said.
One owner, who has been living in Loyang Valley since 1985, told The Straits Times that he expects to get more than $2 million for his 1,500 sq ft unit.
The retiree, who asked not to be named, had paid less than $300,000 for his unit. He said he plans to use the proceeds to buy a four-room Housing Board flat in the vicinity, go on holidays and save the rest.
'I have a feeling the sale will go through this time, after the Government announced that it will lift the height restrictions for buildings around this area,' he said.
Alan Cheong, executive director of research and consultancy at Savills Singapore, said that while there has been talk of easing height restrictions near Changi Airport, the specifics have yet to be confirmed.
On June 25, the Urban Redevelopment Authority will be unveiling the Draft Master Plan 2025, which will provide clarity on the gross plot ratio and updated zoning for the site.
Under the 2019 Master Plan, the site is zoned for residential use and has a gross plot ratio of 1.6. It can yield approximately 1.35 million sq ft of gross floor area upon redevelopment. A new development on the site can accommodate up to 1,249 residential units, averaging 1,076 sq ft each, subject to planning approval.
Cheong said the $880 million price tag is reasonable given the land size, though developers will have to assess the risk of launching a project with more than 1,200 units. 'Still, two factors are in their favour,' he noted.
'One – by the time (the new development) is launched for sale by the developer, probably in 2027, there would have been a lack of new condominium launches in the Loyang area for over three years. This would have created pent-up demand to be discharged into this project,' said Cheong.
'Second, if the sale is successful, by the time the new development is completed, the Loyang MRT station serving the Cross Island Line would be completed and located just adjacent to the site. The developer could then hype his project using this unique selling point. Then, a higher selling price, even with over 1,200 units, would be palatable.'
Lian said: 'While developer appetite for large leasehold sites in the eastern region remains measured, interest is gradually picking up as infrastructure and surrounding industrial developments evolve.'
He explained that the failed 2022 tender came amid a slew of headwinds such as interest rate hikes, construction cost inflation, additional buyer's stamp duty risks, and increased land and development charges. Market conditions have since improved.
Interest rates are starting to ease, and major infrastructure projects in the east, like Changi Airport's Terminal 5, are boosting the site's long-term growth potential and appeal to developers and investors alike, said Lian.
Loyang Valley first attempted a collective sale in 2018 at $750 million, but failed to gather sufficient support. Its 2022 exercise saw stronger backing, spurred by confirmation of the Cross Island Line and growing awareness of the redevelopment potential. But the high reserve price proved a stumbling block.
Now, with momentum on their side, home owners ST spoke to believe the third time is the charm. - The Straits Times/ANN
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