The Costa Sands Resort in Pasir Ris will close on July 20 after 12 years of operations.
NTUC Club, which owns the resort, is not renewing its lease of the resort's site in Jalan Loyang Besar when it expires in August, it said in a press release yesterday.
NTUC said the site will be returned to the Singapore Land Authority (SLA), but the club is not tearing down the chalets at the 163-room resort. Its 30 workers will be deployed to other roles within the organisation, it added.
A spokesman for SLA told The Straits Times that it "will consult URA (Urban Redevelopment Authority) on its plans and may put the site up for interim use depending on the plans".
News of the closure surprised many people, including polytechnic student Lee Kim Weng, 17, who has stayed there an estimated seven times in recent years.
"I am quite sad because it is one of the more affordable chalets that cater to the public," he said, recalling steamboats and barbecues he had there.
The two other Costa Sands Resort properties at Downtown East and Sentosa will stay open.
NTUC said it will focus its resources instead on the $200 million revamp of leisure and lifestyle hub Downtown East.
A new 3.8ha resort at Downtown East is scheduled to open in the second quarter of next year, featuring rooms with views of either the surrounding beach, park or mangrove. The 387-room resort will be on the site vacated by the old Escape Theme Park, which shut in November 2011.
Upon the resort's opening, the 27-year-old Costa Sands Resort at Downtown East will close.
The changes are part of a five- year plan to rejuvenate Downtown East. It includes expanding the Wild Wild Wet water park, and adding attractions like a thrill ride. The project is expected to be completed by late 2017. Work started in March last year.
Facilities at Downtown East remain open throughout the renovation.