Singapore’s office market is running hot — so much so that debt-laden Oxley Holdings Ltd just sold a building for S$365 million ($268 million) more than it paid less than 18 months ago.
Oxley agreed to sell Chevron House, a 32-story tower in the central business district, to Golden Compass (BVI) Ltd for S$1.025 billion in cash and assumed debt, according to a statement. Oxley bought the property, which comprises 27 levels of office space and a five-story retail podium, for S$660 million in December 2017. Golden Compass is controlled by AEW, a US-based real estate fund manager.
The deal is the latest sign of strength in the city-state’s commercial property market.
Office rents climbed to a 10-year high in the first quarter amid constrained new supply and solid leasing demand, according to Jones Lang LaSalle Inc.
Rents should rise 10 percent in 2019, following a jump of 12.4 percent last year, according to Bloomberg Intelligence. Landlords remain fairly optimistic on the outlook for rents and this will be supported by tapering new office supply in the medium term, said Desmond Sim, head of research for Singapore at CBRE.