DBS Group Holding will sell its 28-story PwC building to Manulife for $747 million. The deal is set to go through in March. The amount is based on the property value and Manulife’s repayment of a $402.6 million loan.
DBS China Square constructed the building in 1999, with a 355,704 square foot net lettable area.
A source close to the deal said Manulife hopes with a prime CBD location it will help bolster the Manulife brand and can increase brand visibility to consumers. Manulife hopes that with the purchase of the property, the company can manage its occupancy costs and needs for the long-term.
As it stands, Manulife will make its move into the building by early to mid-2019, using 120,000 square feet of the office space at the beginning. It currently rents 110,000 square feet at the Manulife Centre.
Manulife’s deal with DBS includes giving the bank $1.6 billion for the next 15 years, selling insurance products to the bank’s multitude of customers in four markets such as Hong Kong and Singapore.
The majority of Singapore’s insurance companies with Singapore dollar deposits tend to purchase assets that give a better return rate than Singapore Government bond rates.
With this latest sale, it shows the continue interest in the office market by funds and investors despite three key concerns: rising interest, compressing yields and declining rental rates.
Nic is the founder and principle broker of CENTURY 21 EMAX Real Estate Consultants LLP. Nic starts his real estate career in 1995. He focus in providing real estate services specifically to international high net-worth individuals and corporate clients. His expertise includes luxury home finding, property investment planning & acquisition, managing buy to let property, expat home finding and business space finding.