55 Market Street

Address	55 Market Street, Singapore 048941
Property type	Office
GFA (sqm)	83,173
Seller	AEW
Buyer	Kajima
Deal Structure	100% interest

The property had been marketed by other consultancies before Cushman & Wakefield (C&W) was appointed. However, market interest had not been very strong, primarily due to the initial high asking price.

Despite its freehold tenure and excellent location within Raffles Place, the property did have a few challenges. The low occupancy rate had been a key concern, with only around 10% of the building being leased out. The initial asking price also included all lift lobbies, restroom facilities , and a sky terrace area in the net lettable area calculation, and this faced resistance from prospective buyers. Finally, the absence of carparking in the property was a source of inconvenience for tenants. 

C&W’s Capital Markets team’s recent track record of transacting CBD office buildings has allowed the team to build an extensive network of potential buyers actively looking to deploy funds in Singapore’s CBD property assets. Before the Expression of Interest (EOI) was issued, C&W approached a targeted group of active buyers through a soft marketing campaign, successfully finding the eventual buyer. Throughout the due diligence exercise, the Capital Markets team provided research and analytical support to guide the purchaser on the market outlook, and pathways to achieve target returns. In this way the team was able to help the buyer in overcoming the key challenges, including the occupancy rate, the lack of carparking, and some site technical issues.

The client has been delighted that C&W has successfully achieved an expeditious closing, even before launching the proposed EOI exercise. This was made possible due to C&W’s strong network and insights on the active market players readily looking to deploy fund in such an asset. The sale price achieved for 55 Market Street is one of the highest per square foot rates recorded in Singapore’s history. The speedy and low profile off-market transaction also helped to reduce “market noise” and saved valuable time for AEW, in turn enhancing their IRR.

This transaction marks C&W Capital Markets team’s fourth major Singapore CBD office transaction. A total transaction volume of close to $1.2 billion in just nine months makes the team the top Capital Markets broker in Singapore, with the highest number of CBD commercial buildings transacted in the last 12 months.