Investment Property Sales Jump 94% To $15.7b

Source : The Straits Times, Oct 12, 2007

INVESTMENT property sales nearly doubled, touching $15.69 billion, in the third quarter, reflecting buoyant investor sentiment.

This was 93.9 per cent higher than the $8.09 billion recorded in the same period last year, a new report by property consultancy CB Richard Ellis (CBRE) showed yesterday.

Most investment sales - 64.3 per cent, or $10.1 billion - came from the private sector, while public sector land sales made up 35.7 per cent, or $5.6 billion.

For the first nine months, major property deals worth $40.95 billion already exceed last year's full-year value by 34 per cent, said CBRE.

In the third quarter, the office sector was the top performer, accounting for 43.5 per cent, or $6.83 billion, of major property deals - more than quadruple the $1.37 billion in the previous quarter.

Prime office rents also topped the 1990 historical peak of $11.50 per sq ft (psf) per month to hit $12.60 psf per month, up 82.6 per cent year-on-year.

CBRE expects occupancy levels to stay in the range of 91 per cent to 95 per cent for the next five years, even as more office space is built.

The third quarter also saw a rise in industrial property rents, except for warehouses.

The office space crunch has led to more demand for high-tech space, which has risen 8.5 per cent to $2.55 psf, and is set to reach $2.75 psf by year- end, said CBRE.

Its rental statistics are based on a selected basket of prime office buildings.

The Urban Redevelopment Authority said yesterday that its third-quarter statistics will be released by month-end, and will be more comprehensive as it is based on the tax records of all rental transactions in the quarter.

CBRE has also forecast that a record $50 billion in investment property sales would be completed by year-end.