Shophouse Market Ends Quiet Year 2024 84 Caveated Transactions Huttons
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According to Huttons Asia, the shophouse market remained stagnant in 2024 as there were only 84 recorded transactions. This number is significantly lower than the yearly average of 200 transactions from 1995 to 2023.
Lee Sze Teck, senior director of data analytics at Huttons Asia, notes that while many buyers did not lodge a caveat, 2024 saw the lowest number of shophouse deals since 1998.
The total value of the 84 caveated transactions was $683.6 million, a 38.9% decline from the previous year’s $1.1 billion. Despite this, Lee points out that there were several major deals in 2024 that were not caveated, such as properties on Amoy Street, Neil Road, North Bridge Road, and Telok Ayer Street. He estimates that these deals were worth more than $200 million.
The largest shophouse deal in 2024 was Paragon REIT’s sale of The Rail Mall for $78.5 million in June. This is believed to be the largest shophouse deal on record, surpassing the previous record of $74.8 million for a row of shophouses on Jalan Sultan in March 2022.
The Rail Mall shophouses were valued at $62 million in December 2023, which means the seller made a gain of approximately $16.5 million on the sale.
Most of the shophouse transactions in 2024 were for smaller quantums, with over half of the deals falling between $5 million and $15 million. Additionally, almost half of the transactions took place in District 8, which Lee attributes to its desirable city-fringe location and lower prices compared to Districts 1 and 2.
Despite shophouse rents declining for the second consecutive quarter in Q4 2024, the overall trend for the year was an increase of 1.7%. In Q4 2024, shophouse rents fell by 2.6% q-o-q, reaching $6.47 psf per month islandwide. Recently, conservation shophouses on Telok Ayer Street were put up for sale at $42 million.