Rising numbers of single family offices to bolsters demand for strata offices
Sales volume of shophouses jumped in Q4 2020.
The increasing popularity of Singapore as a wealth management hub for family offices will bolster the demand for real estate investments particularly strata offices and shophouses according to real estate service provider Colliers.
According to Colliers report, Singapore's conducive business environment and government incentives, its availability of talent pool and professional services and its quality of lifestyle have led Singapore to increasingly become the jurisdiction of choice for single-family offices.
Sales volume of shophouses were down 46.1% YoY in Q2 2020, but Q4 2020 investments jumped 51.1% YoY reflecting rising demand for repurposing prime shophouses for new work, live, play trends, such as co-living and co-working.
Meanwhile, transaction volumes in strata offices fell in 2020 due to uncertainties in the market. However, Colliers predicts the office market to recover by the end of 2021 with recovery driven by tech occupiers and shrinking new office stock whilst longer-term drivers such as CBD Incentive Schemes and Greater Southern Waterfront should support the CBD office market outlook.
“We believe family offices are set to grow further with the rising affluence in Asia. This phenomenon bodes well for real estate investments with smaller quantum, such as shophouses and strata offices," head of research at Collier Tricia Song said.