Centurion wins second Singapore worker dorm site in a month with S$221.7m bid
Centurion Corporation has secured a second worker dormitory site in less than a month, paying S$221.7 million for a 30-year leasehold parcel at Lok Yang Way. The project adds 5,000 beds, bringing the company’s combined land outlay for two projects to S$564.7 million and expanding its Singapore capac
Centurion Corporation has won its second Singapore worker housing site in less than a month with a S$221.7 million ($174 million) bid, taking its planned domestic capacity additions to 12,000 beds. State-run JTC Corporation awarded the 30-year leasehold parcel at Lok Yang Way to Centurion on Friday, the SGX-listed accommodation specialist said Monday in a release. Centurion plans to develop the 5,000-bed project through a 90:10 joint venture with an unnamed partner and bring it into operation in the third quarter of 2028.
Together with the 7,000-bed Kranji Close project awarded earlier this month, Lok Yang Way lifts Centurion’s combined land outlay to S$564.7 million and is set to expand the company’s Singapore purpose-built worker accommodation capacity by 29 per cent to 53,898 beds. “The award of both Lok Yang Way and Kranji Close allows us to bring 12,000 beds on stream together in 3Q 2028,” said Centurion CEO Kong Chee Min.
The Lok Yang parcel spans 28,441 square metres (306,137 square feet) in western Singapore on Lok Yang Way between Third and Fourth Lok Yang Roads, just north of the Ayer Rajah Expressway. JTC launched the site in March with capacity for 5,000 beds and up to 1,000 square metres of commercial space, with construction targeted for completion in the second quarter of 2028. Centurion’s Kranji Close project is planned for a 22,079 square metre site in northern Singapore and likewise will be developed through a 90 per cent-owned joint venture. The two projects are among five dormitory sites providing more than 40,200 beds that the government is releasing for completion between 2027 and 2030.
The company said both facilities will comply with Singapore’s New Dormitory Standards and incorporate features aimed at improving residents’ living conditions and pandemic resilience. The projects are due to open as operators retrofit existing facilities to meet higher standards by the end of the decade. DBS analyst Jia Hui Ng said in a July research note after Centurion emerged as top bidder for both sites that “the developments would further strengthen the group’s market-leading position in Singapore’s worker accommodation sector.” DBS estimated the projects to generate yields on cost of 5.7 to 6.2 per cent and lift Centurion’s earnings before interest and tax by 19 to 21 per cent after completion in fiscal 2028 and 2029. The bank maintained a buy rating on the company with a S$1.86 target price, up from the stock’s S$1.58 trading price on Monday.
Centurion plans to fund the Lok Yang land purchase and development through internal resources and external financing, then operate the asset until stabilisation. The company may subsequently offer the facility to Centurion Accommodation REIT under the trust’s right of first refusal, following the same strategy outlined for Kranji Close. The Lok Yang tender attracted 10 bids, with Centurion’s offer finishing 1.2 per cent above the S$219 million submitted by runner-up Banyan Capital. Soilbuild Group ranked third at S$201.4 million, while the lowest offer came from Capital Development at S$158.8 million.
Centurion’s price equates to S$44,333 per approved bed, or 9.5 per cent less than the S$49,000 per bed paid at Kranji Close. The Lok Yang award nevertheless equals 16.7 per cent of the company’s market capitalisation immediately before JTC issued its acceptance letter. The expansion comes after Centurion reported a 31 per cent rise in first-half revenue to S$184.9 million, driven by new Singapore worker housing and Australian student accommodation. Core profit grew 34 per cent to S$87.7 million, while net profit fell 36 per cent to S$53.1 million as fair-value losses weighed on earnings.
