S'pore overseas property investments hit $5.2b in Q3: Report

Singapore recorded $5.2 billion in outbound real estate investment deals in the third quarter of this year, representing a 53.9 per cent growth from the $3.4 billion transacted in the same period last year, according to Real Capital Analytics data.

This was highlighted in a report by Knight Frank analysts yesterday. The analysts said Singapore as a "key exporter of capital" made significant outbound deals such as the acquisition of One Town Centre, an office building in Florida in the United States, for around $133.9 million by Prime US Reit in July, as well as the purchase of an office building in Barcelona, Spain, by IReit Global for about $43.1 million last month.

The report also noted an upbeat pace of deals in the Singapore real estate market, as a total of $7.5 billion in investment deals was made in the third quarter of this year, increasing 58.1 per cent from the $4.8 billion in the third quarter of last year.

This is also a 38.7 per cent increase from the $5.4 billion achieved in the previous quarter.

Despite the increasing Covid-19 infection rates in the past few months, Knight Frank believes that the investment market still remains en route to a projected transaction volume of $30 billion for the whole of this year, given the encouraging pace of investment deals in the first nine months of the year.

"Keeping up with the pace of activity in the investment market, we expect investment sales for the fourth quarter of 2021 to exceed $12.5 billion and the whole of 2021 to breach $30 billion," said Mr Ian Loh, Knight Frank's head of capital markets (land and building, collective and strata sales).

The report added that the bulk of the investment volume was driven by the sale of four Government Land Sales sites, with the award of the Marina View reserve site at $1.5 billion being the top land sale, followed by the Jalan Anak Bukit parcel at $1 billion.

The analysts noted that other land-hungry developers may shift their focus towards smaller-sized plots in a variety of locations, such as sites where owners are attempting a collective sale.

Projects in the range of $600 million and below with about 600 units "might just find willing buyers", they added.

This comes after the Flynn Park collective sale deal at $371 million, or $1,355 per sq ft per plot ratio.

The good class bungalow market also registered a healthy sum of $452 million in deals in the third quarter of this year, although transaction volume is lower compared with the previous quarter.

Increased investor activity is also seen in strata offices and shophouses, both of which remain top choices for acquisition, the analysts noted.

"With interest running high and activity moving at an encouraging pace, continued activity is expected in the commercial and shophouse markets, with more spaces being launched for sale in the coming fourth quarter," they said.


A version of this article appeared in the print edition of The Straits Times on October 06, 2021, with the headline 'S'pore overseas property investments hit $5.2b in Q3: Report'. Subscribe