Relocation of Paya Lebar Air Base could enhance en bloc prospects of some neighbouring condos: analysts

WITH the relocation of Paya Lebar Air Base (PLAB) and the accompanying lifting of building height restrictions, some resale condominiums in areas around Paya Lebar, Marine Parade and Hougang may stand a better chance at a collective sale, while ageing HDB flats in certain neighbouring towns may be candidates for the Selective En bloc Redevelopment Scheme (SERS), analysts said.

In his National Day Rally speech on Sunday (Aug 21), Prime Minister Lee Hsien Loong highlighted that the relocation of PLAB, due to take place in the 2030s, will free up some 800 hectares of land, making room for 150,000 new public and private homes.

In addition, the shifting of the military air base will result in the removal of building height restrictions around it, allowing for the redevelopment of towns such as Hougang, Marine Parade and Punggol. PM Lee also said that the redevelopment of neighbouring towns could result in the better use of space, as well as the addition of more amenities.

The Urban Redevelopment Authority (URA) has started reaching out to the public and industry partners on possible redevelopment concepts.

Christine Sun, OrangeTee & Tie’s senior vice-president (research & analytics), estimates that 30,000 to 50,000 private homes and 100,000 to 120,000 HDB BTO flats could be planned on the Paya Lebar site, which suggests 100 to 130 BTO launches offering 700 to 1,500 units for each project. At a clip of 5 BTO projects annually, the BTO supply could stretch 20 to 25 years.

Meanwhile, she projects 40 to 70 executive condominium (EC) and condominium launches, assuming large condos spanning 500 to 1,000 units. The government could also plan new integrated developments, white sites or mixed development sites in the area if the MRT lines are extended or new MRT stations are built.

Sun added: “There should be healthy upgrader demand should new condos be built in the area. Moreover, due to the generous space available, larger land parcels or bigger condo projects offering ample facilities can potentially be built.”

However, while buyers can look forward to more affordable housing in the longer term with the injection of supply, the supply situation is expected to remain tight in the near term, given that demand for housing – especially in the suburbs – remains buoyant, analysts say.

According to Huttons senior director of research Lee Sze Teck, the earliest the first BTO project would be ready is about 5 years after the relocation of the air base.

Cushman & Wakefield’s head of research Wong Xian Yang reckons that development will take place in phases and, given the size of PLAB, could stretch over 20 to 40 years.

Wong said: “Given its scale, (the redevelopment of Paya Lebar) would mean the creation of an entirely new precinct in the eastern region of Singapore. The introduction of new amenities and reduction of noise footprint due to the relocation of the air base would bode well for existing homes in the area.”

He added: “While overall housing prices are expected to grow over the long term in tandem with economic growth, the increase in housing supply could temper price growth.”

Meanwhile, older buildings in the surrounding neighbourhoods can be redeveloped and built higher as a result of the removal of height restrictions, improving their chance at a collective sale, Sun highlighted.

“The change may lift the en bloc potential of some resale condominiums in areas around Paya Lebar, Marine Parade and Hougang. Some of the condominiums launched in the past, which are below 20 storeys, may have the potential for future redevelopment,” she added.

Huttons’ Lee said: “Assuming the plot ratio for a site has not been maximised due to height controls, then the relaxation of height controls will give a boost to the site’s en bloc potential.”

And older HDB flats in Hougang and Marine Parade that were completed in or before 1980 are seen as possible contenders for SERS as taller flats can be built in their place to better optimise the use of land, Sun suggested. By OrangeTee’s count, there are 8,871 flats in Hougang and Marine Parade that will be more than 50 years old in a decade’s time.

However, Lee also pointed out: “While some older flats in Marine Parade are ripe for SERS, there needs to be a suitable site in close proximity to move residents to.”

Where amenities are concerned, Huttons’ Lee noted that having PLAB in place currently means that traffic has to circle around the whole air base. But once the air base has been relocated, there could be “park connectors and cycling trails linked up across the island and into (the future) Paya Lebar (town)”, he said. “There are also waterways nearby that can be repurposed.”

In his speech, PM Lee also mooted the idea of the air base’s 3.8km-long runway being repurposed as the future town’s central spine, and converted into a green connector or community space. Public and private homes could then be constructed on both sides of the spine.