Rare Opportunity for Investors
The sentiment for strata offices is quite strong in the property market, especially in CBD and they have been enjoying good demands over the years.
Enthusiastic Investors and End-users throng the new iconic developments and g(old) landmark buildings, keeping the market ever dynamic and buoyant.
While Investors relish lucrative returns, Owners and End-users reap win-win results in their collaboration.
The Church Street Holdings, a Buxani Group and CMG partnership bought six floors in Samsung Hub from Levels 16 through 21 at S$1,560 psf in 2007.
Their prudent investment paid off quick – starting from S$2,800 psf in 2011 to S$3,280 psf in 2014, they sold one to two floors every year, not to mention the rental yield during the holding period.
This classic example of wise investment at Samsung Hub Singapore has prompted many to follow their success model.
Business Centre Regus with its dozen footprint in a kilometer radius, thrives at Level 8 of Samsung Hub offering private office spaces, coworking spaces, meeting rooms, business lounges, virtual office solutions etc. with their professional team of hospitality experts.
Owner occupiers of strata business offices and retails shops enjoy their own progress at Samsung Hub in a positive atmosphere of growth and goodwill, as they remain unaffected by the ever-increasing office rental rates.
The market saw dynamic activity in the last two years with major tenants relocating to new facilities and the vacancy being promptly filled-up by the ever-expanding Business Centres like Regus with their flexible workspaces and serviced offices.
New entrants from a range of existing and evolving segments like Ecommerce, Tech, Finance and Transport Network Companies took their turn to aggravate the demand for office space.
Renovations in fresh acquisitions like Chevron House deprived the existing rental space.
A new wave anticipating relocation of several Regional Head Offices from China to Singapore is expected to increase the demand more.
Meanwhile, URA statistics indicate TOP of 49,000 sqm of space in 2019 as against 216,000 sqm supplied in 2018. Hence, availability of office spaces, especially for large ones in CBD is dear with limited supply in 2019.
URA statistics have also revealed hike in office space rental rates and dip in vacancy rates.
While the top recorded rate is S$14.00 psf, the average looms around S$11.50 to S$12 psf.
Reports from 2017 showcases an impressive 20.8% increase in rates as of 2018. The trends are expected to continue into the new year 2019.
This picture at CBD that displays short supply of new office spaces and renovation of old buildings puts tremendous demand on existing premier developments like Samsung Hub.
The highest ever rate recorded in Samsung Hub was the sale of level 20 at S$3,550 psf in 2018.
Sammi Lim, Director of Capital Markets, CBRE brokered the deal. Some optimistic agents of the same firm have quoted up to S$3,900 psf on strata offices available for sale at this period of the year.
Lei Shing Hong Properties (Singapore) with Headquarters in Hong Kong sold Level 20 with strata area 13,132 sq ft at price tag S$ 46.62 million.
A year and a half back, they had acquired the same premises at a price tag S$43.07 million which translates to S$3,280 psf.
The previous highest record was set at S$3,500 psf for a small strata office measuring 883 sq ft on the 17th level at a price tag of S$ 3.09 million in 2013.
So, rates per psf have clearly progressed in the years at Samsung Hub and the trend is expected to continue especially in 2019, where super high demands have been predicted at CBD.