The shophouse market has remained relatively quiet in 2024, with only 84 caveated transactions recorded according to Huttons Asia’s latest quarterly research report. This number is significantly lower than the yearly average of 200 shophouse deals recorded between 1995 and 2023.
Lee Sze Teck, senior director of data analytics at Huttons Asia, notes that although several buyers did not lodge a caveat, the number of shophouse deals in 2024 is likely the lowest since 1998. The total value of the 84 caveated transactions in 2024 amounted to $683.6 million, a 38.9% decrease from the $1.1 billion recorded in the previous year.
However, Lee adds that there were a number of significant shophouse transactions that were not caveated last year. These included properties on Amoy Street, Neil Road, North Bridge Road, and Telok Ayer Street, which he estimates were sold for over $200 million. The largest shophouse deal in 2024 was the Paragon REIT’s sale of The Rail Mall, a 43-unit strip mall on Upper Bukit Timah Road, for $78.5 million in June. This deal is likely the largest shophouse transaction on record, surpassing the previous record of $74.8 million for a row of shophouses along Jalan Sultan in March 2022.
According to Lee, The Rail Mall’s shophouses were valued at $62 million as of December 2023, indicating an estimated gain of $16.5 million for the seller. Most of the shophouse deals in 2024 were for smaller quantums, with over half of the caveated transactions valued between $5 million and $15 million.
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In terms of location, almost half of the shophouse transactions last year were in District 8, which Lee attributes to its desirable city-fringe location and lower prices compared to Districts 1 and 2.
Meanwhile, shophouse rents islandwide have decreased for a second consecutive quarter, with a quarterly decline of 2.6% to $6.47 psf per month in 4Q2024. However, for the entire year, shophouse rents increased by 1.7%.
Additionally, conservation shophouses on Telok Ayer Street are currently up for sale for $42 million, further highlighting the continued interest in shophouse properties in Singapore.