Prominent Singapore Office Tower One Raffles Place in Landmark S$2.3 Billion Sale
One of Singapore’s most recognisable skyscrapers could soon change hands in what may become one of the city-state’s largest office property deals in recent years. One Raffles Place, one of Singapore’s tallest buildings, is reportedly being marketed for more than S$2.3 billion, attracting interest from several billionaire-backed property groups and institutional investors.
According to Bloomberg, parties exploring the potential acquisition include Singapore property tycoons Raj Kumar and Kishin RK, Malaysian developer IOI Properties Group controlled by billionaire brothers Lee Yeow Chor and Lee Yeow Seng, as well as CapitaLand Investment, which is backed by Temasek.
Located in the heart of Singapore’s central business district, One Raffles Place consists of a 62-storey office tower, a 38-storey tower and a retail podium with more than 65,000 square metres of gross leasable area. At 280 metres tall, it remains one of the most prominent office towers in the country.
The building is jointly owned through OUB Centre, with United Overseas Bank holding a minority stake while OUE REIT indirectly controls most of the asset through subsidiaries.
Why investors are willing to pay S$2.3 billion
The reported S$2.3 billion valuation may initially appear aggressive, especially given that office vacancy rates in Singapore remain around 10.8 per cent. However, investors are not simply buying present-day rental income. They are effectively purchasing a long-term income-generating asset located on one of the most tightly constrained office markets in Asia.
Assuming current occupancy of roughly 89 per cent and average Grade A office rents of approximately S$10 per square foot per month, One Raffles Place could currently generate gross annual rental income of around S$75 million. On a simple basis, that implies an annual gross yield slightly above 3 per cent, translating into a payback period of around 30 years if rents and valuations remain unchanged.
But prime Singapore office assets rarely remain static.
4 Different Land Parcels
One Raffles Place, despite appearing as a single integrated skyscraper, actually sits across four separate land parcels, each with different lease terms and start dates. One parcel has an exceptionally long 841-year lease dating back to 1985, while the other three are 99-year leases initiated in 1983 and 1985. This patchwork of land titles reflects how the site was historically assembled from multiple adjoining plots, a common practice in Singapore’s central business district. For investors, the mix of long and shorter leases affects valuation, redevelopment potential, and the long-term economics of the property, making careful analysis of each parcel’s tenure critical when assessing the overall asset.
The 10-year outlook
Historically, Singapore CBD office rents have risen between 1.5 and 3 per cent annually over long periods, supported by limited land supply, strong institutional demand and the city-state’s role as a regional financial hub. Capital values have also appreciated steadily over time, particularly for landmark Grade A towers.
Under a moderate scenario where rental income grows 2 per cent annually, annual rental income from One Raffles Place could rise from approximately S$75 million today to around S$91 million within 10 years. Over the same period, assuming annual capital appreciation of 3 per cent, the building’s value could rise from S$2.3 billion to more than S$3 billion.
The 15-year outlook
By year 15, annual rental income could approach S$100 million while the property itself could be worth roughly S$3.6 billion under similar assumptions. At that point, cumulative rental collections combined with asset appreciation would significantly improve total investor returns.
This helps explain why institutional investors and billionaire-backed developers continue pursuing large Singapore office assets despite relatively modest headline rental yields. For many buyers, the appeal lies less in immediate cash flow and more in long-term scarcity value.
The 20-year outlook
The longer-term economics become even more attractive over 20 years. If rents continue growing at historical averages, annual rental income could exceed S$110 million while the property’s valuation could approach S$4.2 billion. This means investors are not necessarily waiting 30 years to achieve meaningful returns. Rising rents, improving occupancy and capital appreciation can shorten the effective return timeline considerably.
Singapore’s office market has also shown resilience despite global economic uncertainty. Office investment sales surged sharply this year while vacancy rates have begun easing. As supply of premium office space remains constrained, landmark developments such as One Raffles Place continue attracting strong investor interest.
For potential buyers, the tower represents more than a commercial property transaction. It is effectively a long-duration bet on Singapore’s future as one of Asia’s dominant financial and business centres.
