Singapore Commercial Real Estate Deals on Track to Hit Record in 2026 with US$10.3 Billion Closed in H1

“Singapore’s recovery has been driven in large part by overseas capital, with global investors accounting for a significant share of activity in the city-state this year,” said Benjamin Chow, head of private assets research for Asia at MSCI.

The recovery in Singapore is part of a broader rebound across the Asia-Pacific. According to JLL, regional transaction volume in H1 2026 was US$92.5 billion, the strongest first-half showing on record. “Rental growth prospects across nearly all major markets and sectors are very compelling, driven by a lack of supply and rising replacement costs,” said Stuart Crow, CEO of Asia-Pacific capital markets at JLL.

Retail transaction volume more than doubled year on year to US$11.9 billion in Q2, making it the strongest-performing sector across the Asia-Pacific. Based on MSCI data, office transaction volume rose 13 per cent year on year to US$15.7 billion in Q2, taking the H1 volume to US$39.4 billion, up 28 per cent. Industrial deals climbed 28 per cent on year to US$9.7 billion.

Knight Frank highlighted hotels as another bright spot, with investment rising 55.2 per cent year on year to US$5.4 billion in Q2, according to its Asia-Pacific Capital Markets Insights report. The property consultancy attributed the growth to tourism recovery, improving operating performance, and limited supply of quality assets.

Cross-border deal volume jumped 38 per cent in Q2, MSCI said, with global and regional investors making roughly equal contributions. Investors continued to plough money into Asia-Pacific assets, with MSCI attributing this to allocations towards Japan and growing investor appetite for the region more broadly.

Data-centre investment was a notable exception, with acquisition volume falling 37 per cent year on year to US$2.1 billion in Q2. The decline largely reflected the absence of platform deals closing during the quarter, while asset-level activity remained plentiful.

Among the major deals signed in Singapore was the sale of Asia Square Tower 2 in Marina Bay by CapitaLand Integrated Commercial Trust (CICT) to Malaysia-listed IOI Properties Group for S$2.48 billion. CICT will use the proceeds to fund part of its S$3.9 billion purchase of Paragon, the freehold Orchard Road development comprising retail, office, and medical suites, from Cuscaden Peak. The remaining amount will come from debt and a private placement.

Fund managers are increasingly turning to recapitalisations rather than outright asset sales, MSCI said, as they balance investors seeking a return of capital with those looking to extend their holding periods. Japan and Australia raised policy rates in Q2, and South Korea followed with a 25-basis-point increase in July, but investors remain attracted by rental growth prospects across many major markets and sectors.