Real estate investments in Singapore match last year’s record high
Singapore’s real estate investment sales this year are expected to reach the same level as last year’s – which hit a record amount of $40 billion in total, based on just figures attained from the 1st half of the year.
Based on the recent quarterly report prepared by Colliers International, the statistics comprise of sales transactions ($5 million and above) and state tenders (land sales etc).
That includes high-profile en bloc deals for residential properties such as Tulip Garden for $906.9 million, Dunearn Gardens for $468 million, Chancery Court for $401.8 million and Park House for $375.5 million.
Then again, the latest forecast may have to revise downwards from the earlier projection of $46 billion amid new property cooling measures announced by the government back in early July.
Real estate investment sales surged by 19% y-o-y to $12.2 billion in 2Q2018, mainly led by sales from residential properties. It accounted for 67% of the total figure achieve during that single quarter – rising by 60.7% to $8.2 billion as compared to the same period last year.
Colliers noted that the surge in residential sales was mainly attributed by lively activities in the collective sale market which chalked up almost half of the total investment sales volume in the 2nd quarter, helping this segment of the real estate market to a half-year high of $17.3 billion.
The collective sales of 16 private residential developments in 2Q 2018, worth $3.9 billion in total, has brought the tally for the 1st half of 2018 to 33 transactions – valued at approximately $9.7 billion.
Nonetheless, Colliers mentioned that it foresees a slowdown in the collective sale segment for private residential developments due to the increased amount of taxes for investors and property developers which will be imposed under the new set of property cooling measures.
However, the commercial and industrial property segments may pick up in the 2nd half of 2018 due to the constraints and uncertainties in the residential segment, on the back of increasing interest from various real estate investment trusts (or REITs) and also institutional investors.
Early on in the 2nd quarter, various major commercial real estates have changed hands; including Twenty Anson for $516 million, Sembawang Shopping Centre for $248 million and MYP Plaza for $247 million.
It was also mentioned by Colliers that shophouses have also been emerging fast as an alternative investment tool among the affluent buyers, property funds, and investment firms.