Record S$661m worth of strata-shops sold last year

by Cheryl Tay Amid the recent cooling measures implemented in the residential sector, brisk sales for strata-shops peaked at a record S$661 million last year.

R'ST Research's analysis of caveats lodged by the URA revealed that a total of 615 strata-shop units were transacted last year, slightly lower than the record 632 strata shops in 2010, which amounted to S$656 million.

The highest sales were recorded at Sim Lim Square (pictured) with 33 strata-shop units, Icon @ Changi with 29 units and Space @ Kovan with 28 units.

Following a surge of new launches, a record 161 strata shops were sold on the primary market, said Ong Kah Seng, Director at R'ST Research. The robust demand was attributed to the scarcity of new strata-shop projects in recent years, with many existing strata-shops located in older malls such as People's Park Centre, Lucky Plaza and Peninsular Plaza.

The substantial supply of newer choices led to more buyer interest, resulting in resale market volumes declining by nine percent last year from 2010.

Ong said that the popularity of strata-shops was partly due to the cooling measures in the residential sector, such as the additional stamp duties and tighter financing rules. Hence, investors had to look for alternative real estate investments.

"(Strata shops) remain limited in supply, suggesting there may be possible long-term upside, or alternatively, potential for en bloc redevelopment in selected ageing strata-commercial properties," he added.

"Rising business costs have also led to some retailers buying strata shops to have more certainty in running costs."

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