A caveat on September 3 revealed that the entire sixth floor of Tong Building on Orchard Road was sold for $31.33 million. This sale sets a new record for the highest price per square foot (psf) for an office space in the prime districts. The unit occupies a total area of 6,867 sq ft, translating to a unit price of $4,562 psf.
The deal was brokered by Yap Hui Yee, Executive Director of Investment Sales and Capital Markets at Savills Singapore. Tong Building, a 19-storey, freehold strata office building located at the corner of prime Orchard Road and Mount Elizabeth, was built in 1978 by TG Development. Its strategic location, next to Paragon shopping mall and in close proximity to Mount Elizabeth Hospital and Medical Centre, adds to its appeal.
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According to a property title search, the buyer of the office floor at Tong Building is Parkway Hospitals Singapore, a subsidiary of Bursa Malaysia-listed private healthcare provider IHH Healthcare. The medical provider is already a tenant in the building, occupying half of the sixth floor. The other half is currently leased to two other medical companies.
The purchase by Parkway Hospitals Singapore makes perfect sense, given its close proximity to Mount Elizabeth Hospital and Medical Centre, which is just a short walk up the road. Yap noted that there was a significant level of interest from a diverse range of bidders, including end-users and family offices.
The record-breaking price of $4,562 psf for the sixth floor of Tong Building is considered a new benchmark in Singapore’s strata office market, according to Yap. She describes the deal as a landmark transaction in the history of Singapore’s real estate. Interestingly, Yap also brokered the previous high at Solitaire on Cecil in the CBD, where three whole strata floors spanning 37,857 sq ft were sold for $162.8 million, or $4,300 psf, in April 2023.
Moving forward, Yap expects the strata office market to continue its upward trajectory. She points out that with businesses increasingly seeking flexible workspace solutions and adapting to hybrid work models, strata offices have become more attractive than ever. Their resilience and ability to meet evolving demand suggest a promising future outlook for the sector.