Singapore and Australia have long standing economic and social linkages which are likely to get stronger over the years. Australia was the first country to establish diplomatic relations with Singapore post its independence in August 1965.
"When it comes to Australian property Singapore punches far above its weight."
Rohit Mohindra, Head of Commercial Real Estate, Institutional Banking, ANZ Singapore
Bilateral trade with Singapore totals $A20 billion a year and Singapore was Australia's fifth-largest trading partner in 2014, with direct investment reaching $A43.5 billion in 2014.
About 50,000 Singaporeans live, work or study in Australia and 20,000 Australians do so in Singapore. About 100,000 Singaporeans are alumni of Australian universities. Last year alone 400,000 Singaporeans visited Australia while 1,000,000 Australians visited Singapore.
The relationship between the two nations is strong, amplifying the Singaporean appetite for property.
ABOVE ITS WEIGHT
When it comes to Australian property Singapore punches far above its weight. Although China is traditionally seen as the biggest buyer of Australian property from Asia, Singapore is fast catching up.
Indeed, in the five quarters to the end of Q2 2016, total commercial real estate investment into Australia was $US14.6 billion and Singapore had the largest share at 27 per cent, compared to China at 24 per cent.
At least 12 of Singapore’s 30 plus listed real estate investment trusts have significant assets in Australia across the office, hospitality and industrial sectors.
Singapore’s market lead is remarkable given that Singapore is only 3 per cent of China in terms of GDP (Singapore $298b. China $9.24t), with a small population of 5.2 millon people (or 3.2 million citizens) relative to China’s 1.36 billion. Australia is more than 10,000 times the size of Singapore.
Singapore’s Ascendas group paid around $A1 billion for GIC’s Australian logistics portfolio, the second largest industrial property transaction in Australian history. This was further bolstered by a string of transactions by Singapore sponsors as captured below.
CAPITAL FOR ASIA-AUSTRALIA
Foreign investment in Australian real estate is concentrated in three key states: NSW (around 40 per cent), Queensland (around 15 per cent) and Victoria (around 15 per cent). The top three sources of foreign capital are China, United States, and Singapore.