Singapore Sales & Investment Briefing Q1 2025

Savills Singapore is now forecasting that the total investment sales value for 2025 will be S$20B, due to the negative bias from the US tariffs. This compares with our earlier forecast of S$23B.

The 90-day freeze on tariffs has brought some relief, however, how the tariffs will impact Singapore’s real estate market will depend on the negotiations amongst regional countries with the US on ameliorating their respective tariff rates.

“The stage is set for a game theoretic match play amongst countries. Taking into consideration the potential outcomes and payoffs, each country will adopt different courses of action to achieve their local optimal. Over time, after prolonged negotiations, these tariffs are likely to be reduced, but this will take time and there are many paths to the destination. Also, it is not a surety that these tariffs are negative for our real estate market, there are outcomes that are positive,” explains Alan Cheong, Executive Director, Research & Consultancy, Savills Singapore.

“However, one cannot be too pessimistic about the tariffs because if enough countries were to remove them and the US reciprocates, then the benefits that would have accrued to those that did not remove would flow to those that did. The issue here then is about who is likely to lower and the time frame. Therefore, it is still too early to determine at this point whether the medium to longer term impact of these tariffs would be deleterious, neutral or even positive to our real estate market,” he says.

The economic uncertainties arising from trade disruptions caused by Trump’s tariff intentions and ongoing geopolitical tensions are some of the factors contributing to the slowdown of investment activities in Q1/2025. Also, there is a ”price gap” between buyers and sellers and some sellers deciding not to sell or to postpone their sale until 2H 2025. The good news is that domestic borrowing rates have fallen quite significantly in the last few months, which may help narrow the price gap.

While the public sector experienced a 45.1% increase in transaction value, rising from S$1.93B in Q4/2024 to S$2.79B in Q1/2025, it was more than offset by the sharp 47.3% drop in the private sector, where the investment sales plummeted from S$5.71B in Q4/2024 to just S$3.01B in Q1/2025.

The commercial sector closed the first quarter of 2025 with S$1.49B in investment sales, a sharp 54.2% increase quarter-on-quarter (QoQ). This was largely driven by the billion-dollar deal of Northpoint City South Wing. Two other transactions in the quarter worth noting involved the top three strata floors of 20 Collyer Quay, a 24-storey office block located in Raffles Place, which was sold for S$91.8M, and a 19,289-sq ft retail space on the fourth floor of Orchard Towers, a mixed-use development along Orchard Road, which sold for S$54.5M.

The hospitality sector showed promise in Q1/2025, logging S$332.8M in investment sales from three deals, a 26.5% increase compared to the previous quarter. This growth is a sign of investors’ confidence with Singapore’s recovering tourism industry, supported by strong government measures, increased international visitor arrivals, diversified tourism offerings and MICE events.

The top transaction was for Oakwood Studios Singapore – a freehold serviced apartment complex located at 18 Mount Elizabeth in the Orchard Road precinct. The other two hotels that changed hands were 21 Carpenter and Duxton Reserve Singapore, Autograph Collection, with price tags of S$100M and S$80M respectively. Both properties are heritage boutique hotels converted from conservation shophouses located in the Chinatown area.

Investment sales in the industrial sector recorded S$211.2M in Q1/2025. There were seven deals in the private sector in the first quarter, contributing a total transaction value of S$199.4M. The highest-value transaction involved a single-use factory located at 23 Lok Yang Way which was sold for nearly S$70.1M. Another notable deal was the S$62M sale of a freehold industrial building at 21 New Industrial Road.