Real estate investment sales volume surges to $9.17b in H1 2021    

This comes at the back of an active real estate investment sales scene in Singapore.

Preliminary real estate investment sales volume reached $9.17 billion in the first half of 2021, according to a research by CBRE.

This is already at 78.7% of 2020’s volume. Second-quarter (Q2) alone generated $5.11 billion, which reflects a 26% increase quarter-on-quarter (QoQ) and 1.3 times increase year-over-year from Q2 2020 volumes.

The investment volume for Q2 was boosted by residential and industrial transactions.

Investment sales for the residential sector increased by 64.6% QoQ to $2.65 billion, mainly due to the sale of three Government Land Sales (GLS) sites which are the Northumberland Road, Ang Mo Kio Ave 1, and Tengah Garden Walk executive condominium.

Excluding these GLS sites, residential sales volume still stood at $1.42 billion, attributed to healthy activity in the luxury market for Good Class Bungalows and luxury apartments. 

“This reflects the confidence both private buyers and developers have in the long-term future and potential of the Singapore real estate market,” CBRE said.

Industrial transactions kept their pace at $992.06 million this quarter. This is a slight 7.9% drop QoQ from the large transactions and Boustead portfolio deal recorded last quarter. Ascendas REIT acquired the remaining 75% interest in Galaxis for $534 million, whilst ESR-REIT acquired Global Trade Logistics Centre, a prime logistics facility, for $119.6 million. In addition, another eight factories and five warehouses were transacted.

Meanwhile, the office sector registered a 23.3% QoQ decline. But it still turned in a strong performance, with preliminary volume coming in at $755.23 million. This was attributed to Suntec REIT divesting its 30% stake in 9 Penang Road for $295.5 million, Maxwell House being sold for $276.8 million to a joint venture, and the sale of a 40% stake in Westgate Tower to Sun Ventures.

According to CBRE Singapore’s Head of Capital Markets Michael Tay, the active real estate investment sales scene in Singapore indicates that there is abundant liquidity waiting to be deployed and investors are undeterred by the travel restrictions and the recent heightened measures.

He added there has been little or no signs of distress, with prices supported by the macro-stability and effective handling of the pandemic by the Singapore government and that investors are banking on a recovery story with Singapore’s calibrated reopening, vaccination rollouts, and the gradual lifting of travel restrictions.

"Looking ahead, investment sales volume for 2021 is likely to see a strong rebound, led by residential, office, and industrial sales," Tay said, adding: "This will largely be attributed to the upcoming three attractive and relatively large GLS sites at Jalan Anak Bukit, an executive condominium site at Tampines Street 62, and Lentor Central scheduled for launch with tender closing next quarter."