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Investment activity continued to be robust in Singapore, supported by several major office sales.
With total commercial real estate transaction totalling US$34 billion (S$46 billion), the Asia Pacific region witnessed mixed property investment sentiment in the third quarter of 2019.
CBRE’s Asia Pacific Investment Trends report showed that investment sentiment in Thailand and Indonesia have been subdued due to weaker economic growth.
Investment sentiment for Hong Kong properties, on the other hand, have been weighed down by the ongoing socio-political unrest in the city. As a result, both local and foreign investors are becoming more prudent with their dealings.
CBRE noted that foreign investors have also been less active in China during the period under review.
Meanwhile, Vietnam, Korea, Australia and The Philippines enjoyed healthy interest from investors.
Japan also registered steady purchasing activity from J-REITS and property companies, while market sentiment in Taiwan strengthened on the back of robust office purchasing demand from owner-occupiers.
In Singapore, investment activity continued to be robust, supported by several major office sales which include the $1.575 billion sale of office and retail development Duo to Allianz Real Estate and Gaw Capital Partners.
In fact, domestic buyers were in purchasing mode in Q3, while overseas investors retained a healthy appetite for Singapore property, especially high-net-worth investors and family offices.
“However, large deal sizes have prompted them to invest through joint ventures or accumulate partial stakes,” said CBRE.
“Groups with a higher risk appetite are now seeking well located older office buildings for value-added opportunities,” it said.
The report also revealed a “growing interest from new-to-market investors based in Hong Kong drawn to Singapore’s stability”.
With this, some of the REITs have offered their properties up for sale in order to realise asset value.
CBRE noted that investors “are considering Grade B offices with good locations and tenants for value-added deals”.
Victor Kang, Digital Content Specialist at PropertyGuru, edited this story. To contact him about this or other stories, email victorkang@propertyguru.com.sg
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