Singapore real estate investments still kicking overall

Only because government sales offset faltering private sector sales in 2011, says DTZ.

Given this caveat, real estate investments in 2011 reached $28.6 billion. This exceeeds the 2010 total of $27.9 billion, according to DTZ data.

"The increase in real estate investment sales in 2011 was largely due to an increase in sales of land sites and properties by the government, as government sales increased by 28.8% year-onyear (YOY) which more than offset the 12.7% YOY fall in investment sales originating from the private sector," said DTZ in a release.

"Similar to 2010, investment activity in the residential sector was the highest in 2011, accounting for 37.5% of investment sales," it added.

"The Government Land Sales (GLS) programme accounted for almost 70% of all residential investment sales, largely due to the ramp-up in the supply of GLS sites since H2 2010," it said further.

The fourth quarter saw an investment sales rebound for both government and private sectors, coming off from a terrible third quarter performance.

"For Q4 2011, investment sales by both the public and private sectors registered a quarter-onquarter (QOQ) increase. Total investment sales in Q4 2011 recorded a QOQ growth of 67.5% to reach $7.2bn. Nevertheless, investment sales in Q4 2011 was still lower than the $8.1bn in Q1 2011 and $9.0bn in Q2 2011 as the slowing economy which impacted investor sentiment in Q3 2011 continued to affect investors in Q4 2011," DTZ said.

"Investment figures compiled by DTZ Research comprise transactions that are more than $5m each and exclude $1.1bn of transactions in single residential units and lots that cannot be redeveloped/subdivided into more than one plot," it added.

“Real estate investments in 2012 are expected to be more subdued, due to the uncertain global economic outlook. Investments in offices are expected to fall due to the slowdown in occupier demand and projected fall in rents while residential investments will be shored up by the sale of GLS sites as long as there is still healthy response to launches,” said Ms Chua Chor Hoon, Head of DTZ Asia Pacific Research.

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