Singapore Remains Hot Property For Global Companies Looking to Tap Into the Lion City
Global headwinds were not really successful when it came to shaking investor confidence in Singapore last year, with investment commitments exceeding the official forecast by a long shot. The S15.2 billion – which is the same as US$11 billion – in investments that were pulled in back in 2019 was 39% more than what was pulled in the year before that.
According to Dr. Beh Swan Gin, this serves as a great example of Singapore’s position as one of the best places for global companies to tap into the continent’s growth. It is also a great example of Singapore’s competitiveness as an ideal place for innovation, digital, and manufacturing activities. Unfortunately, just like pretty much any other place out there, Singapore could not escape the Coronavirus pandemic.
Real Estate Investment During Coronavirus Pandemic
Although the virus has brought a big shock to the nation’s real estate markets, the impact is not likely to last for a long time. Jerome Wright has stated that the real estate market in Singapore is expected to make full recovery as all the control measures are lifted and industries regain full momentum.
Despite a 24% forecast drop year-on-year that took place back in 2020, real estate investments are expected to grow by 5% a year over the next four years. The residential sector is expected to become the best-performing sector in Singapore. In the first quarter of 2020, this sector led the investment volume for the first time since the first quarter of 2018 (51% of the total). It is also important to note that the overall residential transactions experienced an increase of 68.5% quarter-on-quarter. Although it is true that developers didn’t want to make any rash decisions when it came to bidding for public land sales due to the COVID-19 situation, sustained buyer demand has been reported at new condominium launches, as well as in Good Class Bungalow and landed housing sales.
Industrial Sector in Real Estate Investment
Another sector that seems to be doing quite well is the industrial sector. Mixed-use and commercial deals made up 72% of the second quarter tally as investors from foreign countries invested a considerable amount of their money in some really big central business properties such as Alibaba, TripleOne Somerset, and the parent company of South China’s Morning Post. Wright has stated that Singapore would still continue seeing foreign investors in 2020.
Real Estate Investment in Singapore Market
Although it is true that the Coronavirus pandemic has had an effect on Singapore’s sentiments, its fundamentals are still the same. There is a lot of capital coming in from a number of different sources, including both Europe and Asia. The reason for this is that many people recognize just how stable Singapore really is. This statement is supported by the stability of the government, the stability of the real estate market, and the fact that the Singaporean dollar is one of the most stable currencies that Asia has to offer. That being said, Singapore has benefited from a huge spectrum of capital, including both sovereign wealth and foreign equity funds. Some of the best examples of investments that have taken place in Singapore include Gaw Capita/Alliance Real Estate’s joint of Duo Tower, Qatar Investment Authority’s investment in Asia Square Tower 1, and Korea’s National Pension Service’s investment in Fraser Online.
It should be noted that some investors even come in and invest from scratch, which basically means that they buy land for development under the government’s tender process. Australia-based LandLease is one of Singapore’s latest investors.
Why is Singapore a Hot Property Choice?
One of the best things about Singapore is that it is a very predictable place – it simply does not give you any bad surprises, which is always a good thing. With this in mind, if you are a private equity fund that has a seven-year fund life, even if you invest in a down-cycle, there is still a good chance for you to become a part of the up-cycle.
Singapore offers a whole lot of different opportunities for investors. For instance, Hong Kong-based Sino Group – which has had a significant presence in Singapore for who knows how long – has invested some of their money in some really important projects that have managed to breathe new life into the culturally important Civic District. The group’s acquisition of The Fullerton Building is one of the best examples of this. After a big restoration, the popular building was reopened in 2001 as The Fullerton Hotel – a luxury hotel with 400 rooms.
The Fullerton Waterboat House, The Customs House, and Clifford Pier – all three of these investments have elevated both shopping and entertainment options in Singapore to a completely new level. Each one of these three things provides an elegant platform for either sustainability, arts, or charity activities to further support the community in Singapore.
Mixed Residential & Commercial Project – Pasir Ris 8
Kerry Properties is known for having decades of investment commitment to Singapore, with one of the latest examples of this being a mixed-use residential and commercial project that is expected to be a part of Pasir Ris Central. When it comes to this particular project Pasir Ris 8, the company has joined forces with Allgreen Properties Limited. Learn more about Kerry Properties and Allgreen Properties here.
Some other important property investments that have been made by Hong Kong developers in Singapore include things like Cheung Kong (Holdings), Singapore’s Keppel Land, and Marina Bay Financial Center by Hongkong Land. That being said, despite the fact that the COVID-19 situation has caused many problems to companies from all around the world, the real estate market in Singapore has somehow managed to remain strong even in these unprecedented times.