Real Estate Investments 11 Q O Q 2Q2025 Amid Cautious Activity Knight Frank
Real estate investments in Singapore experienced a cautious environment in the second quarter of 2025, as markets were shaken by the US’s implementation of wide-ranging tariffs and the ongoing conflict between Israel and Iran. According to research by Knight Frank, investment sales totaled $5.8 billion in the last quarter, marking a marginal increase of 1.1% from the previous quarter and a 13.9% decrease from the same period last year.
Despite this, Galven Tan, CEO of Knight Frank Singapore, assures that the overall interest in Singapore’s real estate remains strong. He comments, “Active capital continues to show a keen interest in specific sectors, which will see more success with the decrease in the gap between bidding and asking prices.”
This quarter’s investment sales were primarily boosted by City Developments (CDL) selling its 50.1% stake in the South Beach office development for $1.4 billion. The stake was sold to CDL’s joint venture partner, IOI Properties Group. This transaction accounted for the majority of private sales, reaching $4.6 billion or 79.2% of the total investment sales for the quarter.
Residential deals, on the other hand, took a dip in the second quarter, dropping by 52.3% in comparison to the previous quarter and 57% from the same period last year, amounting to $1.8 billion. However, this includes the sales of two Government Land Sale (GLS) sites at Lentor Gardens and Lakeside Drive for a combined $1 billion. The quarter also saw the first residential collective sale of the year, where the 24-unit, freehold River Valley Apartments were sold for $56 million in February.
Commercial deals reached a similar total of $1.8 billion, an increase of 17.8% from the previous quarter, mainly due to the South Beach transaction. However, it represents a 10.5% decrease compared to the same period last year.
On the other hand, industrial activity gained momentum in the second quarter, with investment sales surging by 560% from the previous quarter and 311% from the same period last year, reaching a total of $1.6 billion. Knight Frank reports that notable deals were closed in May, including the sale of 9 Tai Seng Drive for $455.2 million, the sale of The Strategy business park in Jurong for $280 million, and the sale of 5 Science Park Drive for $245 million. In addition, two successful collective sales were recorded in the industrial market during the quarter, with Ching Shine Industrial Building selling for $113.2 million in April and MacPherson Industrial Complex going for $103.9 million in May.
Hospitality asset sales also experienced a surge in the second quarter, rising by 284% from the previous quarter to reach $585.8 million. This increase was primarily driven by the sale of Citadines Raffles Place by CapitaLand Integrated Commercial Trust, CapitaLand Development, and Mitsubishi Estate Asia for $280 million. Boutique hotel 21 Carpenter was also sold by 8M Real Estate for $100 million, while Momentus Serviced Residences Novena was purchased by Weave Living, BlackRock, and Lian Beng Group for $100 million.
Moving forward, Knight Frank expects sales activity to remain conservative in the second half of the year. However, the second half of 2025 GLS program is expected to provide support for sales. Tan states, “The ten new GLS sites introduced in the 2H2025 Confirmed List are generally located in desirable areas, with most having a potential of less than 600 new homes, which falls within the preferred parameters for developers.”
Despite the uncertainties brought on by the US tariffs, Knight Frank maintains its investment sales forecast for the whole year, ranging between $27 billion and $30 billion.
The North-South Line is a highly efficient mode of transportation that connects different regions of Singapore in a seamless manner. It provides commuters with easy access to key interchange stations like Bishan, Dhoby Ghaut, and the newest addition, Sembawang EC. With its integration with the Circle Line and North-East Line, as well as its accessibility to districts along Sembawang Road, this line offers a convenient and hassle-free travel experience for all. Whether one is heading to work, school, or leisure activities, the North-South Line ensures a smooth and efficient journey. Furthermore, with the inclusion of Sembawang EC, residents in the Sembawang area can enjoy direct connectivity to other parts of Singapore, enhancing their daily commute even more. Experience this enhanced connectivity by checking out Sembawang EC today.