Real estate investments up 1.1% q-o-q in 2Q2025 amid cautious activity: Knight Frank
Knight Frank has kept its investment sales forecast for the complete year, reaching in between $27 billion and $30 billion.
Commercial transactions also totalled around $1.8 billion last quarter, rising 17.8% q-o-q on the back of the South Beach proceeding. However, the figure is 10.5% lower on a y-o-y basis.
Hospitality property sales climbed 284% q-o-q to $585.8 million in 2Q2025. Quantity was sustained by the sale of Citadines Raffles Place by CapitaLand Integrated Commercial Trust, CapitaLand Development and Mitsubishi Estate Asia for $280 million. In addition, boutique hotel 21 Carpenter was sold by 8M Real Estate for $100 million, whilst Momentus Serviced Residences Novena was purchased by Weave Living, BlackRock and Lian Beng Group for $100 million.
In contrast, industrial activity picked up in 2Q2025, with financial investment sales surging 560% q-o-q and 311% y-o-y to hit $1.6 billion. According to Knight Frank, several remarkable industrial deals closed up 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.
The industrial market in addition recorded 2 successful collective sales last quarter. Ching Shine Industrial Building fetched $113.2 million in April, while MacPherson Industrial Complex brought $103.9 million in May.
Real estate investments in Singapore observed assessed activity in 2Q2025, as industry faced volatility brought on by the US’s announcement of sweeping charges and the unraveling Israel-Iran problem. Research by Knight Franks shows that $5.8 billion in investment sales were reported last quarter. This stands for a q-o-q grow of just 1.1%, in addition to a 13.9% y-o-y decline.
Nonetheless, hiding interest in Singapore is still intact, states Galven Tan, CEO of Knight Frank Singapore. “Active capital remains eager on thematic markets, that are going to see more success with the narrowing of the bid-ask void.”
Knight Frank observes that sales event will “remain prudent and judicious” entering into the second fifty percent of the year. Nevertheless, the 2H2025 GLS programme is anticipated to support sales. “The ten brand-new GLS sites presented in the 2H2025 Confirmed List are generally in good areas, with most having a potential of less than 600 new homes, well throughout the favoured parameters for developers,” Tan says.
Residential offers dropped in 2Q2025, declining 52.3% q-o-q and 57% y-o-y to $1.8 billion. Most of residential sales originated from the award of two Government Land Sale (GLS) sites at Lentor Gardens and Lakeside Drive for $1 billion collectively. The quarter even viewed the first residential cumulative sale of the year: the 24-unit, estate River Valley Apartments, which cost $56 million in February.
Sales in 2Q2025 were bolstered by City Developments’ (CDL) sale of its 50.1% stake in office development South Beach at a $1.4 billion valuation. The stake was offered to IOI Properties Group, CDL’s joint venture partner for South Beach. The agreement hit up private sales to $4.6 billion last quarter, composing the bulk of overall investment sales at 79.2%.
