The total investment sales of the Singapore real estate only amounts to S$17.8 billion due to the weak property market trends and grip-tight financing.
“With market uncertainty and economic risks appearing to be on the downside, many investors will remain on the sidelines of the property market, waiting for signs of price stabilisation before investing. With the global economy likely to enter a protracted downturn on the back of the deepening financial crisis, transaction volumes in property are expected to remain low over the next few quarters,” Jeremy Lake, executive director of CBRE, explains.
Shaun Poh, senior director of DTZ, agrees with Mr. Lake, “I would not be surprised if we don’t see any major transactions for the next three to six months. Potential investors are waiting for property prices to come down. Even property funds that have raised money can’t make acquisitions because of the difficulty of raising the debt component to pay for the purchase – despite trying to source for financing in overseas markets like Hong Kong and London in some instances.”
Mister Lake also added, “credit market conditions worsen and lenders further reduce their risk appetite, capital available for property investment would become even scarcer.”
Nevertheless, considerable investments got in this year: These include 71 Robinson Road ($3,125 psf or $743.75 million); Hitachi Tower ($2,901 psf or $811 million); One George Street ($2,600 psf of net lettable area or $1.7 billion); The Atrium Orchard ($2,249 psf or $839.8 million); and Singapore Power Building ($$1,836 psf or 1.01 billion).