Introduction
Singapore’s property market often grapples with the question of lease decay – how a dwindling lease term can drag down a property’s value. This article explores that issue in a general format, using International Plaza as a case study and comparing its price trends with two other downtown condos: Craig Place (a younger 99-year leasehold) and Emerald Garden (a virtually freehold 999-year leasehold). We’ll look at their price-per-square-foot (PSF) trends from 2007 to 2025, highlight how much each has appreciated, and discuss when an ageing lease begins to stunt price growth. This is part of a broader series examining different districts to understand the effects of lease decay on Singapore real estate values.
International Plaza: An Ageing Lease in the Heart of Tanjong Pagar
International Plaza is a landmark 50-story mixed-use development atop Tanjong Pagar MRT. Built in the 1970s with a 99-year lease from 1970, it now has only ~44 years remaining. The building is massive – originally housing around 209 residential apartments, 559 office suites, and 192 retail units under one roof – making it one of Singapore’s biggest integrated projects. Its prime Downtown Core location (District 2) and direct MRT access provide significant advantages. However, the short remaining lease and the building’s age (over 50 years old) present challenges. Buyers know that as the lease runs down, the clock is ticking on the property’s value, and maintenance of such a high-density, mixed-use tower can be costly. International Plaza even attempted an en bloc sale in 2021-2022, aiming to renew its lease via redevelopment, but that bid did not secure a buyer. This context makes International Plaza an ideal case to see how lease decay impacts price trends over time.
International Plaza Street View
Price Trend Comparison: International Plaza vs. Craig Place (2007–2025)
In the above chart, we compare International Plaza with Craig Place, a boutique condo nearby in District 2. Craig Place is a much newer 99-year leasehold (lease commencing 1997) and was completed in 2000. It’s a small development (58 residential units) with some ground-floor shops, sitting on a land plot of about 27,125 sqft – much smaller than International Plaza’s sprawling ~75,000 sqft site. Despite its smaller size, Craig Place enjoyed phenomenal price growth from 2007 to 2025: about +104.85% in PSF, more than doubling its value. International Plaza, in contrast, saw roughly +41.2% growth in the same period (from around $800+ PSF in 2007 to about $1,180 PSF in 2025). Early on, both properties rode the mid-2000s property boom, but by the mid-2010s, International Plaza’s price gains began to stagnate. Its line on the graph flattens in the later years, while Craig Place’s line continues an upward trajectory. The divergence is striking – Craig Place’s newer leasehold still had ~70+ years remaining by 2025, allowing it to appreciate with the market.
Craig Place Street View
In contrast, International Plaza’s value flatlined as its remaining lease dipped below 50 years. The volume of transactions also differed: International Plaza’s sheer number of units meant frequent transactions (reflected by higher sales volume bars in many years), but abundant supply didn’t translate to rising prices. Craig Place, with fewer units changing hands, saw prices jump sharply whenever demand picked up, since there were limited units available. This comparison highlights how a younger leasehold property can outpace an older leasehold in price growth, even if both are well-located – largely because the older one is hampered by lease decay.
Price Trend Comparison: International Plaza vs. Emerald Garden (2007–2025)
Next, we compare International Plaza with Emerald Garden, a near-freehold condo in the adjacent District 1. Emerald Garden is a 999-year leasehold development (practically as good as freehold) completed in 1998, with two low-rise blocks totalling 265 residential units. Tucked along Club Street/Telok Ayer, it’s a purely residential project with a much more intimate, low-density environment than International Plaza. From 2007 to 2025, Emerald Garden’s PSF climbed about +73.4%, significantly higher growth than International Plaza’s +41%. The chart shows Emerald Garden’s price line rising more robustly, especially in the later years, whereas International Plaza’s line flattens. Why did Emerald Garden’s values hold up better? A key reason is the virtually perpetual lease – with no looming expiry, the property’s worth could keep rising with market trends. Buyers treat Emerald Garden like a freehold asset, valuing its prime location without worrying about a ticking lease clock. Moreover, Emerald Garden’s residential-only, low-rise character likely appeals to owner-occupiers seeking a quieter city lifestyle, which supports its prices. International Plaza, despite being at an MRT doorstep, had its growth capped by lease concerns and competition from newer condos. By 2025, Emerald Garden’s average PSF hovered above $2,200, whereas International Plaza’s was around the mid-$1,000s – a gap that widened over time. This underscores how freehold (or 999-year) properties tend to be more price-resilient in the long run compared to older leasehold ones, all else being equal.
Emerald Garden Street View
Understanding Lease Decay: Bala’s Curve and When Growth Stagnates
The above comparisons point to an important phenomenon: as a property’s lease runs down, its price growth eventually stalls. This is best understood through the concept of Bala’s Curve, a commonly cited leasehold depreciation framework in Singapore. In simple terms, Bala’s Curve provides a guideline for how a 99-year leasehold property’s value declines as its remaining lease shrinks (relative to an equivalent freehold’s value). For example, according to this framework:
• Start of 99-year lease: Property is worth ~96% of its freehold value.
• 60 years remaining: ~80% of freehold value.
• 30 years remaining: ~60% of freehold value.
In other words, a leasehold’s value doesn’t drop much in the early decades, but the decline accelerates in later years. The depreciation is non-linear – the last 30 years of a lease contribute far less value than the first 30 years. Bala’s Curve suggests that around the 40-year remaining mark, the decline becomes pronounced. We can see this playing out for International Plaza: around the 2010s (when its remaining lease fell into the 50-40 year range), its resale prices stopped keeping up with the broader market. By contrast, Craig Place still had ~70 years left in 2025, and Emerald Garden effectively doesn’t expire – so those saw continued growth. Real-world prices often follow this pattern: a newer leasehold can appreciate for decades (sometimes keeping up with inflation and general market gains), but once the unit crosses a certain age, buyers become wary of the short lease and price momentum slows or reverses. This is also reinforced by practical financing rules – banks are less willing to give full loans for properties with under 60 years of lease remaining, and CPF usage gets restricted for short leases. These factors shrink the pool of potential buyers, putting downward pressure on ageing leasehold values.
Location, Density, and Use: Other Factors in Price Resilience
While lease tenure is a significant determinant of long-term value, other property factors can influence how resilient prices are:
• Location: In our case studies, all three properties enjoy a prime central location (downtown districts near MRT stations). This strong location helped support their values to an extent – for instance, despite its ageing lease, International Plaza’s location in the CBD still kept it desirable for some (it’s hard to beat the convenience of living right above shops, eateries, and an MRT). Craig Place and Emerald Garden are also in the central area (Tanjong Pagar/Chinatown vicinity), which benefited from the general growth of the downtown property market. Thus, location provided a floor to values, but it could not fully overcome the drag of a short lease in International Plaza’s case.
• Density and Development Type: International Plaza is high-density and mixed-use, blending residences with hundreds of offices and shops in one tower. This means heavy foot traffic and a less exclusive feel for residents (you ride the lift with office workers and shoppers), which can temper its residential appeal. Its age also means an older design and possibly higher maintenance needs. Emerald Garden, on the other hand, is low-rise and purely residential, offering a more tranquil environment with condo facilities – features that can attract homeowners and support value. Craig Place lies somewhere in between: it’s a small-scale condo with some commercial units, offering a more private residential atmosphere than International Plaza, though with fewer amenities due to its size. Lower-density projects often foster a sense of exclusivity and community, making them more attractive to specific buyers and helping prices hold or rise. Meanwhile, mega-developments like International Plaza might suffer from competition (many similar units for sale at any time) and a perception of overcrowding.
• Supply and En Bloc Potential: International Plaza’s large number of units means more supply in the resale market, which can limit price growth (sellers compete with each other). However, it also made headlines as an en bloc candidate – a collective sale of such a huge site could unlock value (the 2022 en bloc attempt pegged the land value at around $2,448 psf ppr, including lease top-up. That speculative en bloc potential may have provided intermittent support to its resale prices (owners holding out for a windfall). By contrast, Craig Place’s small size could make it easier to find a collective sale buyer in the future. However, until then, its units trade on their individual merits. Its scarcity (only 58 units) may have actually boosted prices when demand rose, as there were few alternatives. Emerald Garden, being effectively freehold, isn’t under pressure to redevelop – its value is in continuing as a desirable boutique residence. Freehold properties also have the advantage that owners can hold indefinitely, so they tend not to “panic sell” as the property ages, unlike leaseholds, which face a countdown.
In essence, all three properties benefited from a central location, but the younger leasehold and the freehold had more resilient prices thanks to their structural advantages. International Plaza’s high-density, ageing structure and diminishing lease made its prices far more stagnant. Emerald Garden’s near-freehold status and residential charm helped it ride market upswings. Craig Place’s combination of a decent remaining lease and limited supply allowed its prices to surge dramatically in a rising market.
Conclusion
The case of International Plaza versus Craig Place and Emerald Garden vividly illustrates the impact of lease decay on property prices. International Plaza, with its rapidly shortening lease, experienced a significant slowdown in value appreciation compared to a newer 99-year condo and a freehold-like condo in the same area. Even though all three properties shared the advantage of a prime downtown location, the length of lease emerged as a key differentiator in long-term price performance. A short remaining lease eventually acts as an anchor on price growth. As seen around the time International Plaza fell below roughly 50–60 years remaining, its price trend flattened. In contrast, Craig Place’s still-long lease allowed it to more than double in value, and Emerald Garden’s near-perpetual lease helped it chalk up substantial gains too.
For property owners and buyers, these trends reinforce a few takeaways: Lease tenure matters. A 99-year leasehold can be great for a few decades, but eventually, market appreciation is offset mainly by depreciation due to the shortening lease. Freehold or very long lease properties tend to better preserve value over time, especially in land-scarce, prime locations. Of course, factors like location, project density, and maintenance also play roles in value – a well-located property will always find some demand. Still, they can’t completely counteract an expiring lease. As Singapore’s real estate stock ages, understanding the lease decay curve is increasingly essential for buyers and investors making long-term decisions.
This article is part of a broader series examining various districts and developments to understand how lease decay affects property prices across Singapore. By comparing cases like we did with International Plaza, Craig Place, and Emerald Garden, we hope to shed light on the nuanced ways lease tenure interacts with market forces. Stay tuned for more insights as we explore other areas and property types in upcoming parts of the series.
Article contributed by Jerry Wong.
Jerry Wong is a realtor at Propnex Realty, bringing a rich background in interior and lighting design to his work. He loves exploring diverse spaces and observing the transformative power of real estate. Beyond his professional role, Jerry finds his greatest fulfillment in connecting people with the right properties, gaining immense satisfaction from helping clients achieve their dreams.
