Sales volume of investment deals in 2024 increased to S$26.61 billion, up from S$19.65 billion in 2023. This  represents a significant year-on-year (YoY) growth of 35.4%.  

Notable yearly increases were observed across all asset classes, ranging  from 12.1% to 133.1%. Investment momentum in the private sector has  been reignited, backed by the availability for sale of investible core assets  and better-than-expected economic growth. This, together with higher  proceeds from the sale of GLS lands, has collectively contributed to the  strong showing in 2024. 

Investment sales in the residential sector continued to decline for the  second consecutive quarter in Q4/2024, down 24.3% QoQ to S$2.41 billion.  The private sector witnessed strong performance, largely fuelled by the  S$810 million collective sale of Thomson View Condominium which  garnered significant attention, particularly due to its prime location and  freehold tenure.

Moreover, developers may have gained some confidence  from the robust new home sales in November.  

Likewise, the commercial sector plunged 62.7% from the high base of  S$2.59 billion recorded in Q3, contributing S$966.3 million in investment  sales.  

The industrial sector closed the final quarter of 2024 with S$2.13 billion  million worth of transactions, representing a smaller quarter-on-quarter (QoQ) decline of 14.7% compared to the residential and commercial sectors.  

In contrast to the three sectors mentioned above, both the hospitality and  mixed-use property sectors saw remarkable quarterly growth in Q4/2024.  The former saw CapitaLand Ascott Trust’s (CLAS) acquisition of lyf Funan  Singapore at an agreed property value of S$263.0 million.  

In the mixed-use sector, the most expensive deal from the private sector is  Hotel Properties Ltd’s acquisition of Concorde Hotel and Shopping Mall for  S$821.0 million. This is the largest collective sale in 2024 and also the fourth  successful collective sale in the Orchard Road area since 2022. 

Jeremy Lake, Managing Director, Investment Sales & Capital Markets,  Savills Singapore says, “The volume of private investment sales was lower  than expected in 2024 due to a price gap. We expect this to narrow in 2025  and the investment volume should pick up across the various asset classes  in Singapore as sellers lower their prices a little and buyers increase their  prices a little.” 

Savills Research projects total investment sales value to be about S$23  billion this year, despite the performance of interest rates.  

Alan Cheong, Executive Director, Research & Consultancy, Savills Singapore adds, “Although the market has consistently been using the  interest rate argument as the reason for higher or lower investment sales  numbers but drawing from our investment sales numbers from 2008 to  2024, the link has been tenuous.  

We believe it’s the human factor that is driving this divergence in opinion.  Many times, buyers who asked the question on the net yield spread may  end up not buying the property, leaving it exposed to the market longer than  usual or the sales process terminated.

The drone of having a non-existent net yield spread may thus have built into the market’s belief that interest  rates has been a significant driving force on whether deals get done or not.”