Lured by the Singapore’s stable political environment and relatively strong office rentals, the latest study by Cushman & Wakefield, has shown that Hong Kong investors have deployed US$1.4 billion in Singapore commercial real estate.
Meanwhile, Mainland Chinese Real Estate Investment Overseas (MCREIO) plunged to a seven-year low of US$3.8 billion in the first half of 2019, falling 68% over the same period last year amid restrictive outbound investment policies, a tightening lending environment and heightened global economic uncertainty, according to Cushman & Wakefield Research’s latest H1 2019 China Outbound Investment Report.
In the release, James Shepherd, Head of Research, Asia Pacific, said: “H1 2019 MCREIO transaction volume fell to its lowest point since 2012. Traditionally favoured destinations such as the U.S. and the U.K. have remained quiet as trade friction and Brexit uncertainty has rolled on.”
“Conversely, Singapore started to attract increased attention from Hong Kong investors and may increasingly be viewed as a comparatively safe haven given the challenges some other global destinations are facing,” he continued.
Additionally, the value of transactions by Hong Kong investors in Singapore commercial real estate is higher at US$3 billion year to date. Key transactions include Hong Kong investor Gaw Capital Partners’ purchase of Robinson 77 for US$510 million (S$710 million) in February this year. Gaw Capital Partners also led a consortium including Allianz to buy DUO office and retail space for US$1.1 billion (S$1.58 billion). Another Hong Kong investor, Arch Capital Management completed the purchase ofAnson House at US$151 million (S$210 million) in August.
Christine Li, Head of Research, Singapore and Southeast Asia commented: “Some of these Hong Kong investors and funds have been active in Singapore for some time but the advent of the political situation in Hong Kong has coincided with more high-net-worth-individuals and family offices from Hong Kong enquiring on potential purchases.”