Singapore chosen for central location.
The biggest underwriter of mortgage bonds in the United States, Lehman Brothers Holdings, will be moving the regional headquarters of its real estate arm from Bangkok to Singapore.
Mr Blake Olafson, senior vice-president of Lehman Brothers Global Real Estate Group, said the com- pany chose to move here because of Singapore’s excellent infrastructure, developed capital markets and central location among fast-growing Asian economies.
Lehman Brothers has to date invested $7 billion in Asian real estate, which range from lending to equity projects, and with the relocation here, it plans to double the number of staff at its real estate group in Singapore to 12.
“We recently dramatically expanded our presence in Singapore across all functions of Lehman Brothers in the traditional investment banking sense, equity trading, commodities, private equities,” said Mr Olafson.
The group also announced yesterday its latest development in Singapore — a 26,000-sq-m office building at 71 Robinson Road, to be completed in the second quarter of 2009.
Lehman is developing the $450-million complex in a 50-50 joint venture with Kajima Overseas Asia (KOA).
Mr Masao Hashimoto, vice-managing director of KOA said the building “will offer significant relief amid a current environment of less than 1.65 per cent vacancy rate for prime grade A space, while offering the purpose-built trading floors and superior connectivity favoured by international banking and financial institutions”.
However, property experts say the extra supply of office space from this new building will not ease the rising prime office rents any time soon.
“There will still be an under-supply of property,” said Mr Chris Archibold, regional director at property consultancy Jones Lang LaSalle.
“The rental rates will be maintained as they are, I don’t think there will be any downward pressure of rents in the foreseeable future.”
Prime office rents have escalated over the last few years, with prices now hovering around $15.80 psf.
This is a 44-per-cent increase from the $13.80 psf achieved in the first half of this year.
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