CapitaLand Integrated Commercial Trust (CICT) has recently completed the sale of 21 Collyer Quay, a 21-storey office building located in the central business district of Raffles Place, for a total of $688 million. According to a filing with the Singapore Exchange on Nov 12, the 999-year leasehold building was sold to a third party that is unrelated to CICT. The sale price was based on the building’s net lettable area of approximately 213,000 square feet, resulting in a price per square foot of $3,230.
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The decision to divest the property was made based on a willing-buyer-willing-seller basis, in line with an independent valuation of the property conducted by Savills. The sale price, together with the building’s annualized net property income for the period ending Sept 30, 2024, translates to an exit yield of below 3.5% for CICT. The divestment is expected to generate net proceeds of approximately $681.7 million for the company.
21 Collyer Quay is currently occupied by co-working operator WeWork, which took over the lease of the former HSBC building in 2021 when the banking firm moved its headquarters to Marina Bay Financial Centre Tower 2. WeWork officially opened its flagship location at the building in September 2022 after completing a design and fit-out of the space.
In April this year, WeWork announced that it had concluded a series of lease negotiations with its Singapore office landlords following its bankruptcy filing in the US in November 2023. The company also stated its plans to remain in its current buildings in the city-state for the foreseeable future. According to CICT’s website, WeWork Singapore holds a seven-year lease for 21 Collyer Quay until 2028.