ARA Asset Management has won the bid for a stake in Capital Square office tower in the central business district, according to people familiar with the matter.
Mainboard-listed ARA is buying the 50 per cent stake in the building that was put up for sale last year by Alpha Investment Partners, said the people, who asked not to be identified because the process is private.
The purchase will be concluded by the month's end, one of the people said, without disclosing the price of the deal.
The 16-storey prime office building in the Raffles Place financial district was expected to fetch about $2,500 per sq ft, according to an estimate from Mr Donald Han, managing director at real estate broker Chestertons.
The transaction will add to a recent spate of deals in Singapore's business district as falling rents and a large supply of prime space have pushed valuations lower.
Annual rents on the upper floors of the nation's skyscrapers fell 7 per cent to about US$775 (S$1,058) per sq m in the first six months, according to a 23-city index compiled by Knight Frank released yesterday.
Vacancy rates were 9 per cent in the second quarter, Knight Frank data shows.
The tower, whose tenants include Morgan Stanley, Bloomberg and Citigroup, was bought by Alpha and insurer NTUC Income in 2011 from Munich Re for $889 million, or about $2,300 per sq ft.
ARA declined to comment in an e-mailed statement.
Capital Square, which is spread out over 388,215 sq ft, was built by developer Keppel Land and completed in 1998.
CBRE Group and Jones Lang LaSalle were appointed to market Capital Square, they said in a joint statement in April last year.