Deputy Prime Minister Teo Chee Hean said on Saturday that the Punggol East by-election was "always going to be difficult".
DPM Teo cited the circumstances of the by-election and local issues as reasons as to why it was a tough fight.
The snap polls was triggered by the resignation of former PAP MP of the ward Michael Palmer, who resigned due to an extra-marital affair.
DPM Teo said, however, that the PAP hopes it can win back the ward.
"We are proud that we were able to serve them... we hope they will be able to support us the next time around," he said at a press conference held by the PAP at its branch office in the ward.
He said Rivervale Plaza, a mall in the ward where the upgrading was delayed, will be completed, and that the government will continue its programmes for the long-term interest of Singaporeans.
PAP candidate Dr Koh Poh Koon said that though he was "a bit disappointed", he was "appreciative for all the support I've received".
He thanked all the voters of Punggol East, supporters and volunteers and "the opportunity to make new friends over the last couple of weeks".
He added that he will continue to serve if the party needed him.