Asia’s Largest Real Estate Investment Trust Buys Singapore Shopping Malls For $1.6 Billion

A Hong Kong-based real estate investment trust is buying two shopping malls in Singapore from a co-op.

The property arm of NTUC Enterprise Co-operative will sell Jurong Point and Swing By@ Thomson Plaza to Link REIT. LinkREIT will become one of the top 10 retail asset owners in Singapore as a result of the deal.

There will be a 10-year asset and property management service agreement for AMK Hub which will remain under the ownership of Mercatus.

George Hongchoy, CEO of Link, said in a statement that large suburban retail assets with stable rents are typically tightly held. Link will be able to expand further into other asset classes and strategies in Asia Pacific thanks to this transaction.

The shopping centers in Singapore's suburbs have shown resilience. Suburban malls have been attracting more foot traffic than malls that cater to tourists in prime shopping districts due to their close proximity to residential areas. The average gross rents of suburban malls increased in the third quarter compared to the same period in the previous year.

One of the most densely populated residential areas in Singapore is called Jurong Point and has a 720,000 square feet of net lettable area. Swing by Thomson Plaza has a lettable area of over 100,000 square feet. As of October, the two properties have generated an annual net income of S$106 million.

The company said that it is open to bringing in capital partners for the properties and that it is in active discussions with investors.

A real estate portfolio that includes shopping malls, car parks and offices is owned by LinkREIT. The majority of the properties it owns are located in Hong Kong, with the rest spread across mainland China, Australia and the UK.