The discussions have been shut down (at least temporarily) for BlackRock and a group of other developers (including CapitaLand and Norges Bank) as regards the sale of Asia Square Tower 1, a venture which would be the largest office based deal in the country, if successful. Norges Bank Investment Management handles the sovereign wealth fund in Norway. BlackRock is the biggest asset supervisor in the world for Sturdee Road Condo.
The rumours on the market say that BlackRock is also in discussions with another developer. This party was shortlisted after the completion of an expression of interest venture for the toiwer last year. The prospective buyer is thought to be a group brought together by ARA Asset Management. It includes the Kora Investment Corporation and the California Public Employees Retirement System.
Asia Square SL Capital Sustained Land Condo
All requests for a statement from ARA are outstanding in Bendemeer Road Condo SL Capital.
It is possible that BlackRock might also take up talks with additional interested parties – a number of developers have expressed interest in the venture. They include Keppel Land, the Abu Dhabi Investment Authority, Lend Lease, and the Ping An Insurance Group.
Recently, CapitaLand made it clear that, in conjunction with additional parties, it was pursuing talks with the seller of Asia Square Tower 1.
According to a statement released by the developer, however, ‘discussions have now been brought to a halt.’
Talks in SL Capital Condo
A spokesperson said: “We will still be investigating all ventures which match with our core ethos and values in SL Capital Condo, but they must offer terms which enable us to make the required revenue returns in Sturdee Road Condo Farrer Road.”
According to Bloomberg, a development duo (consisting of the sovereign wealth fund of Norway and CapitaLand) has already been selected as the desired buyer.
It is thought that BlackRock had shortlisted two parties after the expression of interest venture closed. The CapitaLand/NBIM duo was its first selection, with the ARA group coming in a close second.
The Asia Square Tower 1 deal could turn out to be the largest office based sale in the country.
In June, there were reports that the 43 floor property had been put on the market. It was soon revealed that the site carried a minimum cost of $4 billion in Sturdee Road Condo (approximately S$3,200 per sq ft of the total lettable area).
SL Capital Condo
There were more rumours that the cost stood at around S$3.5 billion (approximately S$2,800 per sq ft). Yet, even at this slightly reduced price, experts are sure that the sale would have been inclusive of some degree of income support for Sustained Land Condo. This is in light of falling office rents and occupancy rates across the tower.
As Google is planning to make itself at home in the Mapletree Business City area – close to Pasir Panjang – next year, office rents and occupancy rates are predicted to fall further.