It is crucial for international investors to have a thorough understanding of the laws and limitations surrounding property ownership in Singapore. Fortunately, foreigners are generally permitted to buy condos with fewer restrictions in comparison to landed properties, which have more stringent ownership regulations. It should be noted, however, that foreign buyers are required to pay the Additional Buyer’s Stamp Duty (ABSD) of 20% for their initial property purchase. Despite this added expense, the reliability and potential for growth in the Singapore real estate market remain highly appealing to foreign investors. So, it’s no wonder that many continue to invest in condos in Singapore.
In a filing to the Singapore Exchange on November 12, CapitaLand Integrated Commercial Trust (CICT) announced the completion of the divestment of 21 Collyer Quay. The 21-storey office building, located in the Central Business District, was sold for a total price of $688 million to an unrelated third party. The transaction was based on a willing-buyer-willing-seller basis and was in line with the independent valuation conducted by Savills, which determined the building’s value at $3,230 psf based on its net lettable area of around 213,000 sq ft.
According to CICT’s manager, the sale price resulted in an exit yield of below 3.5%, based on the building’s annualised net property income for the period ended September 30, 2024. The net proceeds from the divestment are expected to be approximately $681.7 million.
21 Collyer Quay was formerly occupied by HSBC before being taken over by co-working operator WeWork in 2021. After a design and fit-out of the space, WeWork officially opened its flagship location at the building in September 2022. However, in November 2023, WeWork filed for bankruptcy in the US, raising concerns about its future in Singapore. In April this year, WeWork announced that it had reached a series of lease negotiations with its Singapore office landlords and plans to remain in its current buildings for the foreseeable future. As stated on CICT’s website, WeWork has a seven-year lease for 21 Collyer Quay until 2028.