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S’pore commercial property deals defy regional slowdown, recording best quarter ever: Report

SINGAPORE – Singapore racked up its best quarter ever for commercial property deals to defy a sharp region-wide decline, noted a report on Wednesday (Aug 10).

Deal volume here climbed 74 per cent to US$5.6 billion ($7.72 billion) in the three months to June 30 – a record level for a single quarter – as institutional investors piled in.

The report from MSCI Real Assets, a part of index compiler MSCI, showed investment across the region totalled US$45.1 billion, a 24 per cent decline from the same quarter in 2021.

MSCI said this drop was led by a sharp fall in trades of individual properties, which totalled only US$33.1 billion, compared with an average of around US$40 billion a quarter for most of 2021.

“Singapore was the star in Asia-Pacific’s gloomy second quarter,” said MSCI, which based its report on sale and purchase data of office, retail, industrial, hotel, apartment and senior housing properties.

Demand for Singapore property was broad-based, with Central Business District offices garnering most investment while shopping centres and hotels performed well too.

Overall transaction volume reached US$7.8 billion for the first half of 2022 in Singapore, up 53 per cent year on year.

“Global investors have been the driving force behind Singapore’s stellar showing this year,” MSCI noted.

Offices continued to be the most sought-after property type, it added, citing the sale of Income At Raffles at over $3,600 per square foot.

Other key deals included Tanglin Shopping Centre, Cross Street Exchange, Westgate Tower and Twenty Anson.

Mr Benjamin Chow, head of Asia real assets research at MSCI, said: “Commercial real estate investment in Singapore went quiet during each of the previous two downturns, but 2022 has proven to be third time lucky with a record level of activity so far.

“While the broader regional slowdown has largely been attributable to fall-off in smaller deals, Singapore’s institutionally dominated market has shrugged off the macroeconomic headwinds.”