Investor

Widjajas sells offices in Singapore to continental investor

The Widjaja have sold their holdings at 15 Scotts Road (Source: Cushman & Wakefield)

A Chinese investor has acquired three strata units in an office building along Scotts Road in Singapore from a company controlled by the Indonesian Widjaja family for 10.1 million Singapore dollars ($7.33 million), establishing the highest price per unit area ever recorded for high-end strata space. Orchard Road shopping district, according to Cushman and Wakefieldwho brokered the deal.

Anonymous Mainland is paying the equivalent of S$4,028 per square foot to buy 2,497 square feet (232 square meters) of strata space on the sixth floor of the nine-story Thong Teck building at 15 Scotts Road, C&W executive director Singapore and capital markets chief Shaun Poh told Mingtiandi on Friday, with records showing Top Global, which was bought out last year by a private vehicle controlled by its chairwoman Sukmawati Widjaja, as the seller.

The sale of the three units, which are currently leased to a pilates studio, will leave Top Global with just levels 1, 2 and half of the third floor as the family-owned real estate investment firm that controls Indonesian conglomerate Sinar Mas Group continues to sell. the 23 condominiums he purchased in the building two years ago.

Wealthy foreign investors are dominating the city’s strata office market this year, with the latest deal coming just a month after downtown Suntec City saw at least three record deals in the space of four months . Such a trend is the clearest sign yet of Lion City’s status as a haven for private wealth.

Major Global Withdrawals

By securing a freehold piece of the 1973 building, the Chinese investor, who reportedly intends to hold the property for long-term investment, paid a 13% premium on the price of S$3,568 a foot. square that Singapore-based watch retailer Cortina Holdings shelled out last month when it bought the fourth floor of the same building for S$49 million.

Top Global boss Sukmawati Widjaja is the eldest daughter of late Sinar Mas founder Eka Tjipta Widjaja.

Top Global, which was privatized last August, bought its basket of properties in the Thong Teck Building for 170 million Singapore dollars in 2019 and made its first sale late last year by selling eight units for S$31.93 million. The sale price translated to approximately S$3,694 per square foot for a combined area of ​​8,643 square feet.

The real estate company has since sold all of its holdings on the 6th, 7th and 8th floors of the building located opposite the Far East Plaza shopping center and a few minutes’ walk from the famous Orchard Road shopping area. Top Global still has two and a half floors in its portfolio following this latest sale.

Sukmawati Widjaja, also known as Oei Siu Hoa, is the younger sister of prominent Singaporean investor Oei Hong Leong and has served as Vice Chairman of Sinar Mas Group since 1988. Sukmawati completed the privatization of Top Global in August of last year in a deal that valued the company at S$106 million.

Wong Xian Yang, C&W’s head of research for Singapore, said Singapore’s office condominium market continues to attract family offices and ultra-wealthy individuals who are less sensitive to interest rate hikes and are looking small investments offering long-term capital appreciation.

“The Singapore market is benefiting from a flight to safety as capital gravitates towards ‘safe haven assets for wealth preservation and diversification,'” Wong said. “While large note transactions remain difficult due to increased borrowing costs, private wealth such as high net worth individuals and family offices are seeking smaller investments such as strata offices and shophouses.”

Over the past 12 months, the real estate agency said its capital markets team had negotiated nearly S$150 million worth of office condominium transactions in the city – with 15 condominium units at 15 Scotts Road representing S$70 million of this amount through sales to 10 family offices and high net worth individuals.

Strangers snap strata units

Including the sale of Scotts Road, Singapore has now seen at least four record-breaking strata office transactions in the past five months, including a series of high water transactions in Suntec City.

Cushman & Wakefield's Shaun Poh

Cushman & Wakefield’s Shaun Poh

Thai national Phucherlin Klongkitjakon, who is a director and board member of Cambodian drinks retailer IQPS Trading, bought the top floor of Suntec Tower One last month for S$39.7 million, or about S$3,850 per square foot, to set the highest unit price ever at the shopping complex.

This sale broke a record of S$3,350 per square foot set a week earlier when the 31st floor of Suntec Tower Two was sold to a buyer in Fujian, China – this deal also surpassing the record price of S$3,300 per square foot set by another Chinese investor who bought the 30th level of the same office building in June.

Along Orchard Road, a portfolio of 39 strata retail lots in the Singapore Mall is currently being marketed for S$40 million, or approximately S$1,739 per square foot for the 23,000 square foot space.

“The Strata subdivision of retail developments at Orchard Road is no longer licensed,” said Swee Shou Fern, investment adviser at Edmund Tie and sole marketing agent for the assets. “This portfolio of premier commercial space provides an affordable option for owner-occupiers who want to operate their business in a central location.”

145 strata office units changed hands in Singapore in the first half of the year for a total of S$365 million, down from 172 transactions worth S$461.9 million observed in the second half of last year.

The tally for the first half of 2022 was also down from S$703.5 million generated from sales of 169 units in the same period last year.