October 2017

Property Market Monitor

Office Key Economic Indicators

 Occupier activity improved in 3Q17, driven by a more positive business GDP real growth
2.9%
sentiment amid the brightened economic outlook. (2Q17, y-o-y)
Consumer Price Index
0.4%
 Rent recovery gathered pace in 3Q17. Overall CBD rents grew for the (Aug 2017, y-o-y)
second consecutive quarter and at a faster q-o-q pace in 3Q17 than in Total Trade (Current prices)
15.6%
2Q17, lifted mainly by high occupancy in quality buildings, especially those (Aug 2017, y-o-y)
in the Marina Bay area. Index of Industrial Production
19.1%
(Aug 2017, y-o-y)
 Capital values also improved at a sharper rate than in the previous quarter,
underpinned by sustained investor interest as evidenced by the sale of Asia Retail sales excl. motor vehicles
(Constant price) 1.9%
Square Tower 2 and Beach Road Government Land Sales site.
(Jul 2017, y-o-y)
 Marina One (1.9 million sq ft) was completed in 3Q17. With this, new supply Unemployment rate (S.A.)
2.2%
has peaked and will taper down and dry up by 2019. (Jun 2017)
Total population
 Businesses would likely seek more office space as the positive economic 0.1%
annual growth (Jun 2017)
outlook could propel growth. This, together with the limited supply in 2018,
could provide the impetus for rents to continue to trend upwards. Source: DOS

Major Property Transactions | 3Q17

31.2 8.86 4.3% 2,376 5.1% Price
Gross Office*
Current Rental Capital Capital (SGD mil)
CBD stock effective rent growth value value growth Asia Square Tower 2 2,094.0
(mil sq ft) (SGD psf pm nla) (q-o-q) (SGD psf nla) (q-o-q) Beach Road GLS 1,622.0
Golden Shoe Car Park
615.4
redevelopment (55% interest)
Residential Price
Residential
(SGD mil)
 There was healthy demand as sentiment remained positive. Transaction Tampines Court
volumes in prime districts declined about 20% q-o-q but rose 20% y-o-y, 970.0**
(Collective Sale)
largely dominated by secondary market transactions, including units from Woodleigh Lane GLS 700.7
several newly completed developments with unsold stock.
Serangoon Ville
499.0**
 Capital values of prime residential properties continued to rise, in keeping (Collective Sale)
with the market recovery. Price
Retail
(SGD mil)
 Leasing activity increased with rents rising slightly. Business conditions are
Chinatown Hotel 31.0
improving. There were fewer units available for lease as some owners put
(12/14/16 Teck Lim Road)
their units up for sale, prompted by rising prices.
26 Ann Siang Road 14.7
 A clearer market recovery will strengthen market confidence and sustain 18/18A/18B Teck Lim Road 13.0
demand. This will result in prices continuing their uptrend.
Price
Industrial
(SGD mil)
60,472 4.65 1.1% 2,756 0.9% Jurong Aromatics Complex 1,971.1
Current Gross Rental Capital Capital Citimac Industrial Complex
prime stock effective rent^ growth value^ value growth 430.1**
(Collective Sale)
(units) (SGD psf pm nla) (q-o-q) (SGD psf nla) (q-o-q) 7 Tai Seng Drive 68.0
*Assets with predominant office component
^The capital value and rental value indicators are reflective of luxury residential properties. **Excludes estimated development charges/premium

Source: JLL Research, October 2017

Retail
 Retail sales have recorded five consecutive months of growth on a y-o-y
Authors
basis, suggesting that consumer confidence, private consumption and
tourist spending is on the increase. However, the positive sentiment has Tay Huey Ying
yet to trickle down to most retailers and their demand for retail space. Head of Research &
Consultancy
 Rental declines for retail space across the three submarkets have
Singapore
continued to taper in 3Q17, albeit at a steeper pace in the Marina
+65 6494 3761
submarket. The rate of capital value correction kept pace with the
Hueyying.tay@ap.jll.com
declining rents.
 The third quarter welcomed the opening of DUO Galleria (56,000 sq ft) in
the Marina submarket which opened to an occupancy rate of about 70%. Doreen Goh
Meanwhile, Century Square (200,000 sq ft), a suburban mall in Tampines, Industrial Analyst
was closed for refurbishment. Although expected to complete only in 2H18, Singapore
it had secured pre-commitments for about 60% of its space. +65 6494 3720
Doreen.goh@ap.jll.com
 Demand for conservation shophouses boosted retail investment sales this
quarter. A notable transaction included the sale of a row of shophouses on
Teck Lim Road which changed hands for SGD 31.0 million. Jenny Goh
 While occupier demand continues to face challenges from the steepening Office Analyst
competition in the retail market, increased tourist arrivals and spending, as Singapore
well as the gradual improvement in consumer sentiment, should see rental +65 6494 3722
Jenny.goh@ap.jll.com
declines continuing to taper off, resulting in moderately stable yields as
capital value correction keeps pace.
Sibyl Teo
8.2 33.35 -0.6% 7,160 -0.5% Retail Analyst
Current Gross Rental Capital Capital Singapore
prime stock effective rent growth value value growth +65 6494 7006
Sibyl.teo@ap.jll.com
(mil sq ft) (SGD psf pm nla) (q-o-q) (SGD psf nla) (q-o-q)

JLL Singapore
Industrial (Business Parks) 9 Raffles Place
 The decline in the vacancy rate extended into its fifth consecutive quarter #39-00 Republic Plaza
Singapore 048619
occupation of their new premises. For example, e-commerce platform tel +65 6220 3888
Shopee moved into its new premises at the Ascent in Science Park 1 during fax +65 6438 3361
3Q17. jll.com.sg

 During the quarter, demand for business park space continued to stem
from qualifying firms from the science, technology and media sectors.
Apart from renewals, some firms such as Google and Oracle
understandably took up additional space due to expansion needs.
 However, rents remained stable in 3Q17 as growth was curbed by

assets. Underpinned by the continued rental stability, capital values also

remained unchanged in 3Q17.
 In view of the better economic prospects and with the vacancy rate
projected to fall further, rents are envisaged to exhibit firmer growth in
2018. With capital values foreseen to move in tandem with rents, this would
translate into relatively stable yields over the same period.

23.1 3.71 0.0% 530 0.0%

Current Gross Rental Capital Capital
BP Stock effective rent growth Value value growth
(mil sq ft) (SGD psf pm nla) (q-o-q) (SGD psf nla) (q-o-q)