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Singapore’s property market has benefited from the political unrest in Hong Kong as investors looked elsewhere to invest and travelers skip Hong Kong for Singapore as a shopping destination.
While the Covid-19 pandemic, which has a more widespread implication, has clouded the economic outlook, CFRA thinks Singapore property market will be fairly resilient to ride the headwinds.
Favorable demand and supply conditions will likely support the private residential property market and keep prices fairly stable in 2020, while firm demand and tight supply will cushion the downside to rents for office space. The retail sector is more vulnerable to economic downcycle as consumers hold their spending and tourism receipts drop.
CapitaLand’s and City Development’s multi-sector property exposure and geographical diversification will likely enable the companies to manage the challenging environment, in CFRA opinion. Currently a pure-retail play, CapitaLand Mall Trust will be most impacted by our cautious outlook for retail but the company’s proposed merger with CapitaLand Commercial Trust provides a more diversified portfolio for the merged entity.
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