Asian Pacific Leasing Signaling Growth
Leasing activity in Singapore is gradually improving.
Q3 sales transactions of significance were Alpha Investment Partner’s acquisition of 50% of a Shenton Way property valued at approximately $487 Million (US), $596 Million (S) and the Robinson Point property of 133,000+ sq ft to Asian investors for $224 Million (US), $274 Million (S).
The demand from non-financial tenants and a controlled pipeline may also allow prime rents to bottom out in 2013. America’s lethargic economic recovery and current economic difficulties in the Eurozone brings about the decelerating of export transactions in the Asian Pacific region.
Grade A office space in Singapore saw an overall vacancy rate of 6.8 percent. During the previous quarter, it was 7.9. Today, it is sitting above the Q3 2011 number of 5.5 percent.
The stalled housing market throughout Asia has led to a substantial rise in the rental market of bustling cities, including Singapore. The commercial markets across the Asian Pacific are in the upturn phase of the cycle, riding a wave of healthy global economic growth and dynamic sentiment.
One property services provider stated in its latest Asia Pacific Property Digest:
“Robust economic growth is propelling new business set-ups and corporate expansion in key markets, where rental rates have seen big increases; and rising wages and a growing middle class in emerging markets are underpinning the retail market.”
The demand grows as a Global appetite for real estate assets remains exceptionally strong.
The Global investment in direct commercial real estate in Asia Pacific jumped 42 percent to $94 Billion (US) in 2006. The trend is surely cyclical, and on the rise again.