Singapore — Asia Square Tower 1 in the Marina Bay financial district is changing hands for $3.4 billion – said to be the biggest single-tower real estate deal in the Asia-Pacific region.
Sovereign wealth fund Qatar Investment Authority has agreed to buy the 43-storey office tower, with a string of blue-chip corporate tenants, from United States private equity giant BlackRock.
Analysts say the deal, along with a recent $560 million offer for Straits Trading Building in Battery Road, will likely ignite further interest in prime office assets here. The market has faced oversupply worries.
BlackRock said yesterday its decision to sell was in line with its investment fund’s aim.
“It would be enormously tempting to just hold and wait, but that’s not really what this pool of capital pays us to do. (It) pays us to develop and then sell. It is purely to do with the timing of funds and capital,” said head of Apac for BlackRock Real Estate John Saunders.
BlackRock maintains a “very positive view” on Singapore’s property market, he added.
While the $3.4 billion figure is a record, the per sq ft price is still lower than the $3,520 psf offered for the Straits Trading Building by Indonesian tycoon Tahir last week.
CBRE, a joint-adviser on the Asia Square Tower 1 deal, said the price works out to $2,720 psf based on 1.25 million sq ft of net lettable area, with a yield in excess of 3 per cent.
Citibank has been anchor tenant since the building’s 2011 completion. Other tenants include Google and Swiss private bank Julius Baer. It has an occupancy rate of about 90 per cent, BlackRock said.