CapitaLand Integrated Commercial Trust (CICT) has successfully sold 21 Collyer Quay, a prime office building in Raffles Place, for a total of $688 million. The transaction, which was disclosed in a filing to the Singapore Exchange on Nov 12, involved the sale of the 999-year leasehold building to an external party. The selling price of the property equates to approximately $3,230 per square foot, based on its net lettable area of 213,000 square feet.
According to the manager of CICT, the sale price was determined through a willing-buyer-willing-seller approach, in line with an independent evaluation carried out by Savills. Taking into consideration the sale price and the building’s net property income for the year ending Sept 30, 2024, CICT is expected to achieve an exit yield of less than 3.5%. The sale is expected to generate net proceeds of approximately $681.7 million.
Situated in the Central Business District, 21 Collyer Quay is a 21-storey office building. At present, it is fully occupied by WeWork, a co-working operator that took over the lease of the building from HSBC in 2021, after the latter relocated to Marina Bay Financial Centre Tower 2. In September 2022, WeWork officially opened its flagship location at the building following a comprehensive design and renovation of the space.
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As reported, following WeWork’s filing for bankruptcy in the US in November 2023, the company confirmed in April this year that it had reached an agreement on the terms of its leases with its Singapore office landlords, and intends to continue operating from its current properties in the country in the foreseeable future. On CICT’s website, it is stated that WeWork Singapore is bound by a seven-year lease for 21 Collyer Quay that expires in 2028.