The amount of capital market transactions involving properties in Singapore is estimated to have reached $25.8 billion between January and November this year, according to Wong Xian Yang, head of research for Singapore & Southeast Asia at Cushman & Wakefield (C&W). This represents a 40.2% year-on-year increase from the $18.4 billion recorded in 2023. C&W defines capital market transactions as deals with values exceeding $10 million.
Wong notes that nearly 60% of these transactions took place in the second half of 2024, driven by a growing investor appetite and increased confidence in potential interest rate cuts by the US Treasury. Three deals worth over $1 billion each were made in 2024, all of which were also transacted in the second half of the year. The largest of these was the sale of a 50% stake in ION Orchard mall for $1.85 billion to CapitaLand Integrated Commercial Trust (CICT) on September 3. The remaining 50% stake is held by Hong Kong-listed property developer Sun Hung Kai Properties.
ION Orchard, a mall with a net lettable area of 623,000 sq ft and over 300 international and local brands, is located in the heart of Singapore’s popular shopping district and directly linked to an MRT station. Above the mall is The Orchard Residences, a 54-storey luxury condo tower with 175 units.
According to Tricia Song, head of research for Singapore and Southeast Asia at CBRE, investors have been drawn to the industrial sector this year, which saw a 174% increase in transaction value from the previous year, reaching $5.6 billion within the first 11 months of 2024. This was driven by a surge of interest in prime logistics and life science assets, as well as the $1.6 billion divestment of a portfolio of seven industrial properties by Soilbuild Business Space REIT to a joint venture owned by private equity firm Warburg Pincus and Australia-listed Lendlease Group in August.
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Despite the unawarded sale of several Government Land Sales (GLS) sites this year, residential development sites sold via GLS tenders still made up 42% of total investment sales for the year. However, four GLS sites on the Confirmed List for 2024 were not awarded, mainly due to low bid prices driven by concerns such as large land quantum and interest rate risk.
Looking ahead to 2025, Wong remains optimistic about seeing an increase in high-value deals, as the US Federal Reserve is expected to continue cutting interest rates. CBRE also expects investment volumes to grow by 10% next year, barring any major economic shocks.