Singapore's commercial real estate investment volume saw a turnaround in 2021 to US$9 billion in total for the year, a triple-digit increase from 2020's muted activity, according to Real Capital Analytics' (RCA) Asia Pacific Capital Trends report.
Market recovery was driven by overseas capital sources, who splashed out on offices in contrast with the rest of the region, noted the report. The sale of office property One George Street to JPMorgan Global Alternatives and Nuveen Real Estate in Q4 2021 marked the first billion-dollar sale since the onset of the Covid-19 pandemic, while German investor AM alpha inked an office deal in the Central Business District for nearly S$269.7 million.
Overall, investment across the property types almost tripled year on year to US$9 billion, bringing Singapore's activity back in line with the pre-pandemic average, the report said.
Singapore investors also notably spent a record amount outside their home market in 2021. Almost US$16 billion was spent on the rest of Asia-Pacific (Apac), making Singapore investors the leading source of cross-border capital ahead of US firms.
David Green-Morgan, RCA's head of real estate research, Apac, said that Singapore continues to be a top target for the world's biggest global investors. Overseas capital accounted for over half of the investment into Singapore's commercial property market in 2021, with more than S$5 billion spent - the second highest on record just behind 2019's peak.
Commercial real estate investment in Apac surpassed the US$200 billion mark for the first time in 2021, RCA said. Volume grew by a fifth year on year, and the "strength" of the rebound was broad-based across most major markets and all major property types, it observed.
According to the report, acquisitions of income-producing property reached US$205.4 billion in 2021 - 22 per cent higher than 2020 and 23 per cent greater than the 5-year average prior to the pandemic. Sales of individual buildings - the bedrock of the investment market - surpassed all previous highs to reach US$152.8 billion.
