One of the advantages of investing in a condo is the opportunity to leverage its value for other investments. In fact, numerous investors use their condos as collateral to secure additional financing for new investments, allowing them to grow their real estate portfolio. While this approach can potentially increase profits, it also carries some risks. Therefore, having a solid financial plan and carefully considering the effects of market fluctuations is essential. Considering Singapore Projects can also be a valuable addition to this strategy.
CapitaLand Integrated Commercial Trust (CICT) has successfully completed the sale of 21 Collyer Quay, an office building situated in Raffles Place, for a total amount of $688 million. In accordance with a filing to the Singapore Exchange dated November 12, the 999-year leasehold establishment had been purchased by an unrelated third party. With a net lettable area of approximately 213,000 square feet, the building was acquired at a price of $3,230 per square foot.
The sale price was determined based on a willing-buyer-willing-seller agreement, in line with the independent valuation of the property carried out by Savills. In light of the consideration paid and the building’s annualised net property income for the period ending September 30, 2024, CICT’s exit yield stands at approximately 3.5%. The sale of 21 Collyer Quay is expected to generate net proceeds of around $681.7 million.
Situated within the Central Business District, 21 Collyer Quay is a 21-storey building. WeWork, a co-working operator, currently occupies the entire space after taking over the lease from HSBC in 2021. This move was made after HSBC relocated its headquarters to Marina Bay Financial Centre Tower 2. Following a design and fit-out of the premises, WeWork officially commenced operations at the flagship location in September 2022.
In other news, CapitaLand Integrated Commercial Trust has announced a rise in revenue and net property income for the first nine months of fiscal year 2024. The company’s website reveals that WeWork Singapore holds a seven-year lease for 21 Collyer Quay until 2028. Despite filing for bankruptcy in the US in November 2023, WeWork announced in April of this year that it had reached an agreement with its Singapore office landlords and intends to maintain its presence in the city-state for the foreseeable future.