Commercial and residential investment sales on the rise

Industrial property sales, however, fell 9.3% QoQ and 43.3% YoY in 2020

Commercial investment sales in Q4 2020 surged by 228% QoQ and 509% YoY to $8.69b, according to Colliers International.

Jerome Wright, senior director of capital markets at Colliers International, has attributed the surge in sales to CapitaLand Mall Trust's (CMT) acquisition of CapitaLand Commercial Trust’s (CCT) six offices and two mixed-use developments for $10.8b in a merger.

CMT's acquisition of CCT's properties was one of the largest commercial deal in Q4 2020. Another large transaction was Keppel REIT's acquisition of Keppel Bay Tower for $657m.

“According to our recent Colliers Global Capital Markets 2021 Investor outlook, offices in key regional centres, including Singapore, are a key area of focus for regional investors, with the pandemic seen as likely to accelerate a shift towards higher-quality assets that meet rising demand for health and sustainability,” Wright said.

Residential investment rose by 92.6% QoQ and 94.2% YoY to $1.97b due to the revival of public and private land sales.

Steven Tan, senior director of investment services at Colliers International, said they expect recovery of private land sales via en bloc and collective sales in 2021 with the help of developer sales and the dwindling supply of private lands.

Christine Sun, senior vice president of research and analytics at OrangeTee & Tie, said developers have been paring down their unsold stock and that the imbalance between supply and demand may keep home prices firm and even rising in some popular areas where new supply is limited.