Investment sales for properties could exceed $30b: report

Investors seek to field capital whilst inflation keeps rising.

Even if interest rates are increasing, investment transactions for Singapore property are expected to surpass $30b, revealed Cushman & Wakefield.

The Singapore Market Outlook for the second half of 2022 showed that investment sales could reach a three-year high as investors are looking into deploying capital due to inflationary pressures.

Cushman & Wakefield noted that Singapore’s image as a regional hub led to higher business investments and expansions, which increased demand for real estate.

The Singapore property market also has a tight supply situation, creating a demand-supply dynamic for Singapore real estate.

Across all segments, office investment sales are dominating the overall investment volumes due to investors' search for quality office properties.

Within the private residential market, recent acquisitions showed that there is a selective appetite for small-medium sites or prudent bids for large sites because of the cooling measures in December 2021.

“Larger sites could still be transacted though pricing needs to be right,” read the report.

If the interest rates are still high next year, property demand will be slow but experts have high hopes that the market will be resilient due to tight supply.

“Property rents and prices for grade A offices and prime logistics are still expected to see inflation-driven growth, and repricing opportunities for these could be limited as asset owners’ holding power remains strong. Rents are largely still expected to grow and support capital values,” said Wong Xian Yang, head of research at Cushman & Wakefield.