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Thread: Investment property deals hit 11-year high

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    Default Investment property deals hit 11-year high

    Q1 property investment sales jump 53% to S$9.2b: CBRE

    By Loh Kim Chin, Channel NewsAsia | Posted: 29 March 2007 2058 hrs


    SINGAPORE : Property investment sales in Singapore rose 53 percent on year in the first quarter to S$9.2 billion.

    According to property consultant CB Richard Ellis (CBRE), this was due to the high volume of development sites acquired.

    Investment sales in the private sector amounted to nearly $7.7 billion, accounting for 83 percent of total sales in the January-March period.

    The remaining 17 percent came from the public sector.

    This comprised the sale of five government sites and the tender of the Sentosa Cove residential land parcels.

    In terms of sectoral performance, the residential sector commanded the lion's share, accounting for 60 percent or $5.6 billion.

    The commercial sector contributed 36 per cent, or $3.2 billion, as investors displayed strong interest in office deals.

    CBRE said office deals will continue to be sought after by property funds, institutional investors and REITs in anticipation of further capital value and rental appreciation.

    It said it expects developers' interest in residential development sites to remain strong.

    And it added that office and retail investment properties will continue to be popular with foreign funds and institutional investors.

    CBRE said the investment market is also likely to see more activity in the public sector in the next quarter and the rest of 2007.

    This was based on its assessment on the positive response to the sites in the confirmed list under the Government Land Sales programme. - CNA /ls

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    Default Q1 investment sales of property up 53%

    Published March 30, 2007

    Q1 investment sales of property up 53%

    Residential sector accounts for 60% of $9.23b total, says CBRE

    By ARTHUR SIM


    SENTIMENT in the property market has continued to be bullish into the new year with figures for investment sales in the first quarter showing an increase of more than 50 per cent from the same period last year.

    According to CB Richard Ellis (CBRE), $9.23 billion of investment sales has been recorded for the first three months of the year. This is up 53 per cent from the $6 billion recorded in Q1 last year.

    CBRE's analysis of data reveals that the residential sector accounted for 60 per cent of total investment sales, or $5.58 billion (including good class bungalow sales).

    The collective sales market saw 26 sites transacted, amounting to $3.84 billion.

    CBRE also noted that the quarter witnessed two significant transactions in terms of absolute dollar quantum - Gillman Heights was sold to CapitaLand for $548 million while Horizon Towers was sold to Hotel Properties and two foreign funds for $500 million.

    Other big-ticket transactions in the quarter include the sale of Anderson 18 to City Developments/Wing Tai for $477.7 million, and Sing Holdings' acquisition of Hillcourt Apartments for $361 million.

    The commercial sector contributed 36 per cent of total investment sales or $3.15 billion in Q1, supported by foreign funds and institutional investors.

    CBRE executive director (investment properties) Jeremy Lake said: 'In view of ongoing strong economic fundamentals and the supply in the medium term, office deals will continue to be very sought after by property funds, institutional investors and Reits in the anticipation of further capital value and rental appreciation.'

    Major commercial property transactions include the sale of Temasek Tower to Macquarie Global Property Advisors for $1.04 billion, and the sale of the office block at Vision Crest as well as The House of Tan Yeok Nee to Union Investment Real Estate for $260 million.

    Of the total investment sales in Q1, 17 per cent or $1.55 billion came from the public sector, comprising five government land sale (GLS) sites and the tender awards of the Sentosa Cove residential land parcels.

    A GLS hotel site at Sinaran Drive was sold to Far East Organization for $131.12 million while a condominium site and selected bungalow plots at Sentosa Cove were sold for a total of $549.5 million.

    Mr Lake said: 'The investment market is also likely to see more activity in the public sector in the next quarter and the rest of 2007, going by the positive response to the sites in the confirmed GLS list.'

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    Default Investment property deals hit 11-year high

    March 30, 2007

    Investment property deals hit 11-year high

    Record $9.23b of properties sold in first quarter, says CB Richard Ellis

    By Fiona Chan


    DEVELOPERS and investors continued to snap up properties in the first three months of this year, setting yet another record for investment sales.

    They bought $9.23 billion of investment properties, the highest quarterly value in at least 11 years, said property consultancy CB Richard Ellis (CBRE) yesterday.

    This comes on the heels of a bumper year for investment sales, which amounted to a decade-long high of about $27 billion last year.

    And the momentum is likely to continue, leading to a new record this year, said Mr Jeremy Lake, CBRE's executive director of investment properties.

    'We're at a rare point in time where all the sectors are experiencing strong demand,' he said.

    'In any market at any point, you normally find one sector that stands out and another that is weaker, but right now in Singapore, all five engines are roaring away.'

    These five 'engines' are the residential, office, retail, hotel and industrial sectors, said Mr Lake.

    For each sector, investment sales - comprising property sold for more than $5 million - are often used to measure medium- to long-term confidence from the view of developers and major investors.

    Although all five sectors did well in the quarter, residential sales took the lion's share of deals, accounting for 60 per cent of total investment sales, said CBRE.

    This was boosted by the record amounts paid for Gillman Heights, Horizon Towers and Anderson 18.

    The three estates, which were all sold this year, alone accounted for $1.5 billion of the quarter's investment sales. They now hold the top three spots in terms of dollar value paid for a residential collective sale site.

    In all, 26 residential sites were sold en bloc, fetching a total value of $3.84 billion.

    But the office sector saw the biggest deal of the quarter - the $1.04 billion sale of Temasek Tower to a fund.

    Trailing that in the sector were the Singapore Exchange's sale of its SGX Centre stake for $271 million, and OCBC Bank and CapitaLand's sale of their stakes in Samsung Hub for $275.3 million.

    In total, commercial deals made up 36 per cent of investment sales in the quarter, or $3.15 billion, said CBRE.

    Hotel sales also remained 'very healthy', said Mr Lake.

    He expects activity in the hotel and office sectors to keep buzzing in the light of the limited supply of properties in both categories.

    Even the industrial sector, which has remained relatively low-key so far, did well. It was buoyed by active acquisitions by real estate investment trusts, Mr Lake said.

    In the public sector, the sale of five Government sites and some Sentosa Cove land parcels boosted its share of investment deals to $1.55 billion. And this sector is likely to do better in the months to come, with more Government sites slated to come on the market, said Mr Lake.

    These include highly anticipated commercial sites such as the former Non-Commissioned Officers Club on Beach Road and a land plot at Marina Bay.

    So far, there has been 'positive response to the sites in the confirmed Government land sales list', said Mr Lake.

    He added that in general, it is 'extremely likely that investment sales for this whole year will set another record'.

    It will probably surpass last year's record, 'which was in itself a quantum leap over the previous record', he said.

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