Property investment sales jump to $8.2b in Q2 22

Sales were driven by the commercial sector.

Property investment sales jumped to $8.2b in Q2 2022 from $6.0b in the same period last year, data from Knight Frank showed.

The Q2 2022 figure brings the total investment sales for H122 to $20.2b, which is 88.7% more than the $10.7b registered in H121.

According to Knight Frank, 76.1% of the total investment in Q2 was private deals, driven by the commercial sector.

The commercial sector had three of the five highest transactions for Q2, with the sale of Comcentre ($798.7m), Golden Mile Complex ($700.0m), and Westgate Tower ($677.5m).

Knight Frank said investors likely diverted their focus on commercial assets given current economic conditions, from rising interest rates and inflation to the prolonged Russia-Ukraine war. 

“Key factors that could influence such investment decisions are the likelihood of capital appreciation and organic growth through recurring rental income, as well as the lack of Additional Buyer’s Stamp Duty (ABSD) rates incurred for commercial developments – a defensible asset class against looming economic uncertainty,” Knight Frank added.

Meanwhile, the residential side also saw some development in investment. Two of the top five transactions for the quarter were residential properties: the Land site Pine Grove (Parcel A) ($671.5m) and the Land site at Dunman Road ($1.283b).

“Given the successful sale of commercial developments with a hospitality component such as 28 and 30 Bideford Road, interest in the Singapore real estate market will continue throughout the remaining half of the year despite a looming recession,” said Knight Frank.

Knight Frank predicts the total investment sales for the whole of the year to hover within the range of $32b to $35b, barring any other major external headwinds that could drastically alter overall business sentiment.