Singapore property investment sales total $6.1 bil in 1Q2022, boosted by commercial sales: Cushman & Wakefield

SINGAPORE (EDGEPROP) - The property market in Singapore saw a total of $6.1 billion in investment sales transactions during 1Q2022, according to a recent research report by Cushman & Wakefield.

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This marks a 17.5% drop q-o-q, driven by a lower amount of transactions in the industrial and mixed segments. Nonetheless, investment sales were up 40% on a y-o-y basis, supported by robust activities in the residential and commercial markets.

Residential investment sales totalled $3 billion in 1Q2022, up from $2.8 billion recorded the previous quarter. The increase was driven mainly by Government Land Sales (GLS) amounting to around $2 billion, comprising the land parcels at Lentor Hills Road (Parcel A), Jalan Tembusu, Dairy Farm Walk, along with the Bukit Batok West Avenue 8 executive condominium site. No residential GLS tenders were awarded in 4Q2021.

In contrast, private residential investment sales fell by more than 60%, with developers more selective and cautious following the latest round of cooling measures as well as higher construction costs, notes Wong Xian Yang, Cushman & Wakefield’s head of research.

The residential collective sale market mainly witnessed the sales of small sites during the past quarter, including Gloria Mansion, Vicenta Lodge, and Baode Building which were transacted at $70.3 million, $27.2 million and $27 million respectively.

Wong anticipates developers’ land acquisition activities to pick up in subsequent quarters, driven by low levels of unsold stock, as well as developers having a clearer picture of the cooling measures’ impact on home buying demand.

Meanwhile, commercial investment sales saw a significant increase in 1Q2022, rising 19% q-o-q to around $2.6 billion. This comes on the back of several large commercial deals such as the the divestment of Cross Street Exchange by Frasers Logistics and Commercial Trust for $810.8 million, the en bloc sale of Tanglin Shopping Centre for $868 million, and the sale of 55 Market Street which for $287 million. (Find Singapore commercial properties with our commercial directory)

“These transactions have indicated investors’ strong confidence and preference for quality assets in Singapore’s CBD amid the expected strong growth for the office market this year,” says Shaun Poh, executive director of capital markets at Cushman & Wakefield.

He anticipates sales momentum to stay robust this year amid stable economic growth and the gradual resumption of various economic activities.

A number of commercial investment deals are projected to be finalised this quarter, including Lendlease Global Commercial REIT’s acquisition of the remaining interest in Jem Mall at an agreed property value of $2.08 billion; the acquisition of 79 Robinson Road by CapitaLand Integrate Commercial Trust and CapitaLand Open End Real Estate Fund for about $1.3 billion, and the potential sale of Golden Mile Complex.