Investors are not chasing growth; rather, they are pursuing the oldest defensive instinct in the market — capital preservation. This rotation isn’t visible in public data yet, because they only register once a deal is closed. There is a distinct lag of six to 18 months between the formation of an investment mandate and the final execution of a deal in commercial property.
During this time, buyers work through intermediaries and conduct due diligence while valuing their discretion. Today’s public data reflects decisions made before the recent surge in market volatility. The numbers will catch up eventually.
The buyers driving this are predominantly family offices and high-net-worth investors (HNWIs), including those with Middle East exposure — capital that has been operating in a volatile geopolitical environment and is now actively seeking alternatives.
For them, the appeal of Singapore is not difficult to explain, but understanding why this particular asset class has become the destination requires looking at both a policy shift and a longer-running structural story that most observers could overlook.
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The primary catalyst was the April 2023 increase in the additional buyer’s stamp duty (ABSD). By doubling the foreign buyer surcharge on residential property from 30% to 60%, the government effectively closed the door on residential assets for foreign capital.
Commercial freehold property, however, remained untouched; it stayed open to foreign ownership without a surcharge.
Reducing this shift to a policy response misses the deeper story. The structural case for Singapore freehold commercial property existed long before 2023. For instance, Geylang has recorded cumulative capital growth of 605% over 23 years. Properties along Amoy Street, Telok Ayer Street, and Club Street in Chinatown have recorded capital gains of 1,160% over 20 years.
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Given the limited supply of such assets, these examples illustrate that few real estate asset classes have delivered comparable long-term growth. These are not projections, but rather, observable facts derived from a supply-constrained asset class in one of the world’s safest financial centres.
These are not projections. Rather, these are observable facts derived from a supply-constrained asset class in one of the world’s safest financial centres.
Institutional investors largely ignored this sector because it lacks liquidity and demands hands-on operational management. These assets do not fit neatly into standard fund mandates. Yet, the very traits that deterred institutions — illiquidity and the need for active management — are exactly what attract family offices and long-term private investors. They prioritise stability over mark-to-market performance. The change in stamp duty did not create this opportunity, but it forced a new class of buyer to recognise what was already there.
This redirection is occurring in a climate that reinforces the strategy. Policy shifts in Washington and Beijing currently influence equity markets regardless of corporate fundamentals. That volatility is corrosive to long-term capital. Singapore freehold commercial property offers an alternative. It is anchored to physical asset values rather than sentiment, located in a jurisdiction with a strengthening currency and clear regulatory frameworks. For investors already managing geopolitical uncertainty, this stability is the entire thesis.
Singapore’s family office ecosystem has expanded from roughly 400 to over 2,000 licensed offices in recent years, a trend both influencing and shaped by this dynamic. These offices did not arrive looking for property; they came for the tax environment and financial infrastructure.
Once established, however, the search for yield-generating assets led naturally to freehold commercial property. The market is far more active than headline transaction volumes suggest. The assets meeting the criteria of freehold tenure and locational scarcity are becoming harder to find just as the buyer pool expands.
This is not a temporary fluctuation — it is a structural shift, and capital of this nature rarely retreats once it finds a stable home.
Maureen Li is CEO and founder of ABIEL Property Investment Fund
