Singapore property investment volume jumps 38.7% to S$7.5b in Q3

Government Land Sales accounted for half of the transactions.

Singapore saw a healthy influx of investment deals in the third quarter of 2021, recording S$7.5 billion worth of deals, with 49.7% contributed by transactions in the public sector. According to Knight Frank, this transaction volume represents a 38.7% quarter-on-quarter (q-o-q) increase from the S$5.4 billion in the previous quarter, and a 58.1% year-on-year (y-o-y) growth from the S$4.8 billion in the same period last year. 

Government Land Sales (GLS) sites accounted for the majority of the investment volume during the quarter. The priciest sale was the award of the Marina View reserve site at S$1.5 billion, followed by the Jalan Anak Bukit parcel at S$1.0 billion. 

“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. With the seal of the Flynn Park collective sale deal at S$371 million or S$1,355 psf ppr, this could cause a ripple effect in the en bloc market given that many owners are keen to collectively sell their ageing units. As such, projects in the range of S$600 million and below with about 600 units might just find willing buyers,” Knight Frank says.

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Correspondingly, the Good Class Bungalow (GCB) market reported a healthy level of sales in Q3, registering a total of S$452 million in deals, albeit at a slower pace and lower transaction volume when compared to the previous quarter. Some of the significant GCB deals within the months of July to September included the sale of detached homes at 11 Queen Astrid Park to TikTok CEO Chew Shou Zi for S$86 million (S$2,704 psf on land) and at 3 Bishopsgate for S$65 million (S$2,208 psf on land). More GCB deals are currently being negotiated and should complete before the end of the year. 

The increased investor activity is not only evidenced in the residential sector as strata offices and shophouses also remained top choices for acquisition. The third quarter recorded a spate of deals including the purchase of 61 Robinson by Rivulets Investments for S$422 million as well as a portfolio of six office floors in Suntec City Towers that was sold to Silk Road Property for a total of some S$197 million. 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. 

As the manufacturing sector leads economic recovery, the industrial market was characterised with a stable flow of transactions. Key deals in the quarter included the sale of a warehouse at 28 Quality Road for S$50.0 million and a single-use factory at 45 Tuas View Circuit for S$27.7 million. The industrial sector will continue to feature steady investment activity and this trend will likely spill over into 2022.