The police has updated that the “suspicious item” is a toy resembling a grenade:

Final Update – Case of Suspicious Item FoundThe item has been established to be a toy, resembling a hand grenade….

Posted by Singapore Police Force on Friday, 3 November 2017

The Singapore Police Force has urged members of the public to avoid the Penang Road area, near the Istana, as they investigate a grenade-shaped object found there.

In a Facebook post today at 4.15pm, the police said that a “suspicious item” is being investigated near the Istana grounds:

“Case of Suspicious Item Found
“The Police are currently attending to a case of a suspicious item reported along Penang Road. Please avoid the area.
“Members of the public are advised not to speculate on the cases. Updates will follow.”

Case of Suspicious Item Found The Police are currently attending to a case of a suspicious item reported along Penang…

Posted by Singapore Police Force on Friday, 3 November 2017

The local broadsheet has reported that the item was found near the the junction of Penang Lane and Penang Road, and that it was reported to the police by a caller around 2pm.