Chevron House at Raffles Place has been sold for $547 million to a fund management Deka Immobilien of Germany, taking the total value of Singapore office investment sales deals this year to around $3 billion.
The price works out to around $2,083 per square foot based on the net lettable area (NLA) of 262,650 sq ft.
Formerly known as Caltex House, Chevron House is a 33-storey building on a site with a remaining lease of about 78 years.
The property is being sold by Goldman Sachs funds who paid $730 million or about $2,780 psf for the property in 2007. That acquisition was funded mostly by a consortium of lenders headed by Standard Chartered. The latest transaction is slated for completion by late October, ahead of the expiry of the financing facility, sources say.
The Singapore office market has seen a steady rental recovery after the global financial crash.
‘The fundamentals are attractive. Investors have realised this over the past three months and investor appetite has increased significantly. Parties looking to invest include Reits, other property funds and private investors. Appetites range from $100 million to $500 million-plus,’ said a market watcher.
Deka, the buyer, is a unit of DekaBank in Germany. This is Deka’s first major property acquisition in Singapore and is said to be at close to 4 per cent net yield. Chevron House is currently 98% occupied. Major tenants include Chevron and Visa.
The property consists a four-storey retail podium, 29-storey office tower and three basement levels. B1 has retail shops linked to the Raffles Place MRT Station, while B2 and B3 contain 96 carpark lots.