Strong recovery expected for real estate: study

Recovery is still threatened by prolonged global lockdown.

Singapore placed fifth in terms of geographical markets and is expected to attract the most real estate investments in 2021, according to Savills Investment Management’s latest survey.

The study has reiterated that Singapore stands out as one of the key markets expected to attract stronger investments. Savills IM also said that although income from commercial properties slowed down in the first nine months of 2020, the percentage of industrial deals has doubled from 13% in 2019 to 25% in the same period in 2020.

“Over USD 675 million worth of industrial deals were transacted since the start of 2020 to Q3 2020,” Savills IM said.

They expect this pace to be sustained in terms of higher allocation to logistics but also mentioned that restrictive border controls may pose a challenge for foreign investors to inspect properties.

However, long-term government plans to rejuvenate the CBD should also serve to attract continued investor interest, said Savills IM.

Based on Savills IM’s analysis, Singapore commercial investment volumes are likely to rise from an estimated USD 3.2 billion by end-2020 to USD 5.6 billion in 2021.

Meanwhile, retail will continue to suffer due to lack of tourism and weaker local spending in Singapore.

“A risk to watch out for in 2021 is a prolonged lockdown globally due to a resurgence in new infections. This would have an impact on investments in Singapore for foreign investors,” Savills IM added.