SEB Asset Management has exploited the market opportunities in Singapore and sold its investment in Springleaf Tower, a 37-storey Class A office building, at a profit. Its partial ownership share comprises twelve “strata title” storeys with a total of around 9,900 sqm of office space. The total proceeds generated from the sale of the individual floors amount to SGD 289.3 million (approximately EUR 170 million). The selling price is 30 percent higher than the purchase price paid in 2007 and substantially above the most recent valuation. The majority of the buyers are Chinese companies using the chance to establish a presence in Singapore.
The Springleaf Tower office tower on Anson Road was purchased at the end of 2007 for SEB Asian Property Fund, the Luxembourg-based special real estate fund. The Class A building is located in the central business district (CBD) of the Shenton Way submarket, only a few minutes’ walk away from Tanjong Pagar Mass Rapid Transit station.
The Asia-Pacific region is becoming increasingly important in the global economy.
Consequently, many investors have stepped up their search for investment opportunities in the markets there. “Singapore in particular is highly popular among domestic and foreign investors”, said Choy-Soon Chua, the SEB Investment GmbH managing director responsible for SEB Asset Management’s Asia business. “We exploited the high demand that exists in particular for highquality office space in prime locations. Within just eight months, we achieved an excellent premium for our investors by selling the 12 office floors individually, generating a significant profit”.
At the beginning of 2013, the Company had already successfully sold its approximately 54 per cent investment (around 10,350 sqm of space) in the 79 Anson Road office property in Singapore. The selling price was up 16% on the most recent appraisal value.
However, Choy-Soon Chua commented: “These profitable sales in Singapore do not change anything in our strategy of continuing to invest in growth markets. Our current focus is on Japan, which is in a much better position for an upturn than many other Asian markets. Given the strong macroeconomic data, long-term investors now have an excellent opportunity to generate reliable risk-adjusted income in the region.” SEB Asset Management is currently in promising investment negotiations in Japan, among other places, for office buildings and a hotel.
SEB Asset Management has been active in Asia-Pacific since 2006 with an aggregate deal volume of approximately EUR 2.5 billion to date. Its total real estate fund assets under management in the region are in excess of EUR 910 million.