Sale of HDB shophouse in Toa Payoh offers prime entry point into the area's long-term rejuvenation

Amid the flurry of activity in the private residential market, real estate investors would be wise to consider more stable, income-generating assets like HDB shophouses. An opportunity has just arisen to acquire one such prized property in the mature Toa Payoh neighbourhood. The 1,478 sq ft HDB shophouse on the market is located at 125 Toa Payoh Lorong 1, one of the most centrally located estates in District 12. The property is available for $2.88 million and is on a prime site bounded by Toa Payoh Lorong 1 and Toa Payoh Lorong 2. It is also less than 200m from Braddell MRT Station on the North-East Line. According to LTA ridership statistics, this station serves approximately 13,000 MRT riders daily and is intrinsically linked to the nearby HDB flats. The shophouse is also near Toa Payoh West Market and Food Court, Kheng Cheng School, Toa Payoh West Community Centre, and the Singapore Federation of Chinese Clan Association Building on Toa Payoh Lorong 2. Anchored by a series of rejuvenation plans for the Toa Payoh estate and several thousand new households moving into the vicinity of the shophouse, the new owner stands to capitalise on the transformation of Toa Payoh, which is set to increase pedestrian footfall and uplift capital values in the area.

Market Comparison

The HDB shophouse for sale is exclusively marketed by Aster See, senior marketing director at ERA Realty. The industry veteran says that most HDB shophouses located at the city fringe locations typically yield a rental return of income (ROI) of around 2-3% based on their sales price. "In contrast, the shophouse at 125 Toa Payoh Lorong 1 offers an estimated ROI of approximately 4%. Given its competitive pricing and strong value in comparison, this property stands out as a more attractive investment opportunity for those seeking higher rental returns," she says.

Financial Insights

She adds that this property also presents an attractive investment opportunity with an estimated rental yield of approximately 4%. Such yields are competitive in the current market and offer steady income for investors. "Coupled with a potential capital appreciation in the future, as Toa Payoh continues to rejuvenate, the long-term ROI ofthis property could be substantial".

Remaking Toa Payoh

Toa Payoh will benefit from several government initiatives and schemes to rejuvenate the mature housing estate. It is one of three neighbourhoods earmarked for rejuvenation under the government’s third phase of its Remaking Our Heartland programme. The programme, first introduced by then-Prime Minister Lee Hsien Loong in his 2007 National Day Rally speech, offers comprehensive rejuvenation plans for HDB towns and estates to ensure their sustainability and vitality. Since 2015, plans for Toa Payoh have been progressively implemented, with several aimed at enhancing commercial and recreational facilities. The most notable development is the new integrated project on the site of the former swimming complex, sports hall, and stadium along Toa Payoh Lorong 6. The upcoming integrated development will comprise new sports facilities, a football stadium, a new swimming pool complex, indoor sports halls, sheltered tennis courts, futsal courts, netball courts and fitness studios. National training centres for aquatics, netball and table tennis are planned for the site, which will also include a polyclinic and library. When the 12ha integrated development is completed in 2030, it is expected to enhance Toa Payoh’s appeal as an HDB town and drive up footfall for the area's shops, including the HDB shophouse up for sale at nearby 125 Toa Payoh Lorong 1.

Toa Payoh and Caldecott rejuvenation

The government’s plans to rejuvenate Toa Payoh and neighbouring Caldecott will be anchored by several thousand new flats in these two estates. One of the upcoming Build-To-Order projects is Toa Payoh Ridge, located at the junction of Toa Payoh Rise and Lorong 1 Toa Payoh. The 920-unit BTO project is less than 300m from the HDB shophouse for sale. Toa Payoh Ridge was launched as part of the February 2020 BTO exercise. It consists of four 40-storey residential blocks and is expected to be completed in 1H2025. The BTO project sits between Toa Payoh and the upcoming Caldecott estate, which has been earmarked for future residential development. Caldecott has been earmarked for future residential development since 2017, when the government announced plans to build new BTO flats on a 10ha plot next to Caldecott MRT Station on the Circle Line. These new flats will be less than 500m from the HDB shophouse for sale at 125 Toa Payoh Lorong 1. The government appears to be laying the groundwork for a new BTO project in Caldecott, adjacent to Toa Payoh Ridge. Last February, the URA rezoned a plot at the junction of Toa Payoh Rise and Braddell Rise from educational to residential use, with an impressive gross plot ratio of 5.0. This suggests a high-rise BTO development may be in the site's pipeline. Supported by these surrounding developments, the shophouse for sale could benefit from the increased footfall around the area as the customer catchement of the area broadens. The construction of new BTO flats in Caldecott and Toa Payoh promises good news for the new owner of the HDB shophouse for sale. As nearby residential developments rise, the area will attract an influx of new residents. For more information,
Contact Aster See | 98416930
Senior Marketing Director (R063006G)
ERA REALTY NETWORK PTE LTD