Shophouses: the latest collectors' items?

AS age-old heritage properties, Singapore shophouses are proving to be a timeless asset class. Despite the onset of the pandemic last year, the market for these conservation properties has turned highly active. Mary Sai, executive director of capital markets at Knight Frank says: "Shophouses have become investors' newest collector's item given its potential for price appreciation."

In July, Knight Frank reported that the first half of 2021 saw 118 shophouse transactions valued at S$836.1 million, backed by the pick-up in activity from the fourth quarter of 2020. The half-year's total transaction value was also equivalent to 91.6 per cent of that in the full year of 2020. Average prices are also steadily climbing. Transactions from January to July reached about S$4,425 per square foot (psf) on average, a 16.3 per cent increase from that of the whole year of 2020.

Knight Frank added that buyers exhibited a "continued appetite" for shophouses, with the second half of the year having potential to reach "new benchmark prices".