Real estate investment deals in Q3 2021 saw a 38.7% growth quarter-on-quarter, and a 58.1% increase year-on-year.
Singapore registered $7.5 billion in real estate investment deals in the third quarter of 2021, up 38.7% quarter-on-quarter from the $5.4 billion posted in the previous quarter, revealed a Knight Frank report.
On an annual basis, transaction volume increased 58.1% from the $4.8 billion recorded over the same period last year.
“The bulk of investment volume in Q3 was driven by the sale of four Government Land Sales (GLS) 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 $1.0 billion,” it said.
“With frenzied bidding at certain recent GLS tenders, other land-hungry developers may shift their focus towards the greater diversity offered by smaller-sized plots in a variety of locations, such as sites with more palatable quantums where owners are attempting a collective sale.”
Knight Frank added that the $371 million collective sale of Flynn Park could cause a ripple effect within the en bloc market, considering that many owners are keen on selling their ageing units collectively.
With this, projects within the range of $600 million and below with around 600 units may find willing buyers.
Knight Frank believes that much of the investment activity over the coming months “would comprise the limited supply of new GLS parcels available for tender in the H2 2021 Confirmed List”.
It also expects well-located smaller sites on the Reserve List to be triggered as the unsold stock of private homes runs down.
Meanwhile, the Good Class Bungalow (GCB) market also registered a healthy level of sales at $452 million in Q3 2021, albeit at a lower transaction volume compared to the previous quarter.
Knight Frank noted that more GCB deals are being negotiated, which it expects to complete before year-end.
“The increased investor activity is not only evidenced in the residential sector as strata offices and shophouses also remained top choices for acquisition.”
Among the deals registered in Q3 included Rivulets Investments’ $422 million acquisition of 61 Robinson and the $197 million sale of a portfolio of six office floors within the Suntec City Towers to Silk Road Property.
“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.”
On outbound investments, the city-state registered some $5.2 billion of outbound investment deals during the period under review, up 53.9% from the $3.4 billion transacted over the same period last year, showed Real Capital Analytics (RCA) data.
Notable deals included Prime US REIT’s $133.9 million purchase of office building One Town Center in Florida, United States, as well as IREIT Global’s $43.1 million acquisition of an office building in Barcelona, Spain.
“Despite the looming uncertainties that prevail amid the spike in infection rates in the recent months, the encouraging pace of investment deals in the first nine months of the year represents an improving business sentiment that will continue into the last quarter of the year and next year,” said Knight Frank.
For the whole of 2021, it expects investment transaction volume to hit $30 billion.
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Cheryl Chiew, Digital Content Specialist at PropertyGuru, edited this story. To contact her about this story, email: cheryl@propertyguru.com.sg.
