Singapore office and private residential property market : an industry and company analysis

Abstract

The motivation for this research project stems from interest in (1) ,the rapid development of

the local office property market buoyant about the growth in the financial and business sectors

and, (2) the recent boom in the private residential property sector. This research is carried out

with the objectives of assessing the outlook for the office and private residential property

markets in Singapore ( through an industry analysis) and their impacts on selected property

companies (through a company analysis).

Our industry analysis revealed that the office property market in Singapore is currently

experiencing a boom which is likely to persist until 1998. This is due to limited new office

space supply in the near to medium term and strong demand driven by favourable economic

fundamentals in Singapore as well as Southeast Asian region. On the other hand, the outlook

of the private residential property market is mixed, depending on the type and locality of the

properties concerned. Supply, though huge, is expected to be met by the demand for private

housing. Prices for related categories, such as those with freehold or 999-year tenure and

prime locations, are likely to increase while others are expected to be mo~e affordable in the

near future.

Our company analysis revealed that Straits Steamship Land and Singapore Land Limited are

strong office property market players while Malayan Credit Limited and First Capital

Corporation are highly exposed to the private residential property sector. City Development

Land is active in both sectors. In addition. Straits Steamship Land and City Development Land

are expected to outperform the rest in the future in view of their overall exposure to the local

property market and their regionalisation drive.