A fund managed by Singapore-listed ARA Asset Management has acquired Robinson Centre, a 20-storey office construction along Robinson Road. The land has a net lettable area (NLA) of over 130,000 sq ft. Although no price was revealed, it was allegedly sold for about $340 million, or about $2,600 psf based on NLA. The deal was brokered by real estate investment advisory and brokerage company, Sakal Real Estate Partners.
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The billionaire makes real estate investments throughout his company Homax Equity, which has a registered office at Robinson Centre. The company had acquired Robinson Centre at 2011 for a reported $293 million.
The sale of $ Robinson Centre bookends a year that saw more than $7 billion worth of commercial investment sales (of at least $5 million each).
“Robust rental growth is likely in the near to midterm, backed by strong demand and limited new supply”
Another factor that may contribute to increase demand is that the potential withdrawal of office space in buildings on websites using 15-year transitional leases or Temporary Occupation Permit (TOL), that were purchased from 2007 to 2011. Ming estimates the amount of displaced office space from these types of websites to be near a million sq feet, which subsequently,”could fuel rental increases too”, he notes.
Apart from institutional investors, interest is expected to come from private high net-worth individuals also, especially in light of growing uncertainty in the area, and in particular, Hong Kong. “Anecdotally, we are getting heightened amount of info from Hong Kong domiciled investors,” says Ming. “If uncertainties in Hong Kong persist, we all think that these preliminary pursuits will materialise into transactions within the span of the new year”