Allianz Real Estate makes foray into Singapore office market with SGD537.3 million investment

Picks up 20 per cent stake in Ocean Financial Centre from Keppel REIT

November 29, 2018

Singapore-based real estate investment trust Keppel REIT has sold a 20 per cent interest in Ocean Financial Centre, a Grade A office building located at the heart of Singapore’s CBD, to Allianz Real Estate. This is the German insurer’s property investment arm’s first core office investment in Singapore. The transaction is subject to closing in December 2018.

Mr Stuart Crow, Head of Capital Markets, Asia Pacific, JLL, says: “This transaction is indicative of global investors’ confidence in Singapore thanks to its ongoing political stability, robust infrastructure and strong market fundamentals. Singapore’s prime office rents have climbed a total of 18 per cent over six consecutive quarters since 2017. It also highlights the continued trend of joint venture structures between global capital and local expertise for prime assets in Asia Pacific.”

Ocean Financial Centre, which opened in 2011, towers 43 storeys above Raffles Place. With distinctive plant-covered external walls and energy-efficient features, it was recognised with the Green Mark Platinum Award and Green Mark Pearl Award in 2016 by the Building and Construction Authority of Singapore. The building offers a total net lettable area of 877,635 square feet of Grade A office space, with retail component on its ground floor and basement level. Current tenants include ANZ, BNP Paribas and Drew & Napier.

“There’s a limited supply of premium office space in the CBD, in light of the lack of new completions in the CBD and the withdrawal of more assets for redevelopment and refurbishment. With rising  investment sales and capital values, I’m confident we will see increased interest from both global and domestic investors off the back of this deal,” adds Mr Greg Hyland, Head of Capital Markets, JLL Singapore.

According to the real estate consultancy firm, Singapore’s CBD office supply will only grow from 2020 onwards, with the scheduled completions of ASB Tower and Afro-Asia i-Mark. In 2021, CapitaSpring and the redevelopment of Hub Synergy Point should complete, followed by IOI Properties' development in Marina Bay in 2022.

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