Jan 10, 2020
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“Commercial properties continued to lead investment sales as investors were encouraged by a more positive outlook for the office and hotel sectors,” explained Knight Frank.

While Singapore saw total investment sales drop 10.6% year-on-year to $30 billion in 2019, the city-state registered several sizable commercial property transactions, revealed a Knight Frank report.

In Q4 2019, investment deals fell 27.1% quarter-on-quarter to $7.3 billion.

Commercial property investment sales rose 2.06 times to $12.5 billion in 2019 from $6.1 billion in 2018. Commercial investment sales, however, eased to $2.6 billion in Q4 from $3.9 billion in the previous quarter as Q3 had a higher base and due to the seasonality effect.

“Commercial properties continued to lead investment sales as investors were encouraged by a more positive outlook for the office and hotel sectors,” explained Knight Frank.

A notable deal was Keppel REIT’s $547.7 million sale of Bugis Junction Towers to Village Prop.

And given the rising tourist arrivals and limited supply of hotels, Singapore’s hotel sector posted a total sale amount of $4.4 billion last year, of which $1.1 billion worth of transactions was registered in Q4.

Notable hotel deals in Q4 include Andaz Singapore Hotel’s $475 million sale to Hoi Hup Realty and CDL Hospitality Trusts’ (CDLHT) divestment of Novotel Clarke Quay hotel for $375.9 million.

Despite the slowing manufacturing sector and the ongoing trade war between US and China, investment sale of industrial properties jumped 31.5% to $4.4 billion in 2019, with about $2.6 billion registered in Q4.

Heliconia Realty’s $1.6 billion sale of the business park within Pasir Panjang to Mapletree Commercial Trust (MCT) posed as the biggest transaction in Q4.

“In light of the Central Business District (CBD) incentive scheme, Knight Frank envisages investors’ appetite for commercial developments to remain keen in 2020 as they look for prime sites or developments for wealth preservation purposes or areas earmarked for increased plot ratios with the potential for redevelopment,” said the report.

Victor Kang, Digital Content Specialist at PropertyGuru, edited this story. To contact him about this or other stories, email victorkang@propertyguru.com.sg

Related Articles:

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Singapore posts record hotel deals amid surge in tourist arrivals

Singapore a real estate investment bright spot

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