Foreign property investors ploughed $5.68b in Singapore real estate in H1

Big-ticket office deals boosted sales.

Singapore’s property investment market sizzled in the first six months of the year, driven by large investment deals involving prime office assets.

According to CBRE, total investment sales for the first half of 2016 amounted to $9.56 billion in its tally of transactions above $10 million.

Not surprisingly, the $3.4 billion sale of Asia Square Tower 1 made up 35% of the half-year tally. Apart from this transaction, other office major deals which contributed to the strong quarterly sales include the sale of Straits Trading Building at $560 million, the sale of a 60% in CapitaGreen for $960.3 million, and the sale of a 50% stake of 78 Shenton Way at $301.5 million.
CBRE’s data showed that foreign investors remained active as they ploughed $5.68 billion in Singapore real estate in the first half of 2016, making up 59.5% of the total tally.

“The numbers for the first half of 2016 look very strong, helped by the conclusion of several big private investment deals. The market saw a few new entrants making their first foray in the Singapore market. These include Qatar Investment Authority and Hong Kong-based Shun Tak Holdings,” said Desmond Sim, head, CBRE Research, Singapore and Southeast Asia.
While analysts expect that more big-ticket office deals may be on the horizon after the sale of Asia Square Tower 1, Sim noted that Singapore’s investible universe in the near horizon is limited.

“This presents a challenge for foreign investors,” he cautioned.

On the residential property front, major investment deals include the sale of Shunfu Ville through a collective sale which amounted to $638 million to Qingjian Realty in the second quarter, and the sale of 9 Cuscaden Road at $145 million by Shun Tak Holdings.

With fewer land plots sold under the Government Land Sales programme, residential sales recorded a smaller quantum, CBRE noted.