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Ocean Financial Centre at Raffles Place is set to be partly-owned by Germany’s Allianz Group, after Keppel REIT agreed to sell a 20 percent stake in the property for $537.3 million, according to an SGX filing on Friday (30 Nov).
The stake is being acquired by Allianz Real Estate, the investment and asset management arm of the Munich-based financial firm.
Based on an independent valuation by Cushman and Wakefield VHS, the entire property was appraised at around $2.62 billion as of 15 November, with a 20 percent stake translating to $525.3 million. With this, the selling price is $77.1 million, or 16.8 percent higher than the historical purchase price of $460.2 million.
“Keppel REIT will recognise an estimated accounting gain of $11.9 million, before transaction costs. After taking into consideration the estimated transaction costs of $5.0 million, the estimated net gain is $6.9 million,” said the trust’s manager.
The building consists of a 43-storey Grade A office tower and a retail component on the ground floor and basement levels. Overall, it has a net lettable area of 877,635 sq ft.
It is also directly connected to Raffles Place MRT interchange through an underground pedestrian network.
Stuart Crow, JLL’s head of capital markets for Asia Pacific, told the Business Times that the transaction signifies strong interest in Singapore investment properties.
“This transaction is indicative of global investors’ confidence in Singapore thanks to its ongoing political stability, robust infrastructure and strong market fundamentals. Singapore’s prime office rents have climbed a total of 18 percent over six consecutive quarters since 2017.”
The transaction is expected to be completed by December. Thereafter, Keppel REIT will still control a 79.9 percent stake in Ocean Financial Centre.
Romesh Navaratnarajah, Senior Editor at PropertyGuru, edited this story. To contact him about this or other stories, email romesh@propertyguru.com.sg
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