SINGAPORE: In a significant downturn, outbound investments from Singapore have witnessed a staggering 94.9% year-on-year plunge in the first quarter of 2024, according to data released by MSCI Real Assets. This decline amounts to $911 million, marking a stark contrast from previous periods.
The dip remains substantial quarter-on-quarter, with deals dwindling by 54.3%, painting a picture of cautious investor sentiment amidst uncertain global market conditions.
Market analysts, including those at Knight Frank, attribute this drastic decline to the prevailing tentative and cautious market sentiment.
According to Knight Frank, global investors appear to be adopting a wait-and-see approach, possibly holding off on major investment decisions until a notable reduction in interest rates or a calming of global tensions.
Analysts suggest that investors are utilizing this period to conduct thorough evaluations and due diligence on potential acquisitions. Many seem to be in a discovery phase, assessing opportunities to pursue once market conditions become more favourable.
Despite the overall decline, several noteworthy outbound investments from Singapore emerged during the first quarter of 2024. Among these, StorHub’s acquisition of five assets totalling $403.0 million in Australia stands out, occurring in March.
City Developments Ltd (CDL) also made a notable move with its purchase of Yardhouse in Central London for $148.6 million in February.
These investments, amidst the broader decline, highlight strategic moves by Singaporean entities to capitalize on select opportunities even amidst challenging market conditions.
However, the overall trend suggests a cautious approach prevailing among Singaporean investors, awaiting more conducive circumstances before committing to significant overseas ventures.