2H 2025 Landed Shophouse Report: Fewer Deals Amid Price Growth, But Central Region Demand Holds Firm

The landed shophouse market further weakened in 2H 2025, with only 36 transactions amounting to $281.2 million. While this marks a slight uptick from the 34 transactions worth $235 million in 1H 2025, the overall transactions for the year are at a 10-year low. Compared with the peak in 2021, when 245 landed shophouses worth a total of $1.8 billion changed hands, the market has slowed in the past six months. 

A combination of factors, from rising price levels to increased global economic uncertainty, may have reduced investors’ appetite for shophouses. However, although transaction volume appears low, it is important to note that some deals might have been completed through Special Purpose Vehicles (SPVs) or via share sales. Transactions without lodged caveats were also not included. This is a common practice that buyers do not lodge caveats if they do not take a bank loan for reasons such as better privacy. 

This inactivity occurs because there is an impasse between sellers and buyers regarding prices, as demand remains healthy. Shophouses remain highly sought-after assets, but prices remain the main obstacle. 

Landed Shophouses Transaction Volume and Price

The market exhibits a tenure-based divergence. Of the 36 landed shophouses transacted in 2H 2025, 86.1% (31 units) were of Freehold (FH) tenure, including shophouses with leasehold tenures of more than 99 years. 

Comparing 1H 2025 to 2H 2025, the average psf price of freehold landed shophouses decreased by 18.0% to $3,989 psf. Some owners may be taking this opportunity to sell their shophouses to realise profits after benefiting from price growth over the past few years. Institutional investors could also be diversifying their holdings as part of their asset recycling strategy.

Chart 1: Transaction volume and transaction value of landed shophouses

Because they are immune to lease decay, freehold shophouses can withstand market volatility and maintain their value over the long term. Institutional investors see this as an asset worth holding in their portfolio even as prices stabilise. 

Higher prices for freehold properties have also established a baseline for leasehold shophouse prices, leading to an uplift. Their 99-year leasehold (99-LH) counterparts saw a 7.1% increase in price per square foot to $4,758 psf. However, the rise in average price was also influenced by an outlier transaction - A 99-LH shophouse at 78 Pagoda Street was sold for $12.0m, or $10,478 psf.

Chart 2: Average PSF prices for landed shophouses

Over the past decade, the price quantum of landed shophouses has generally increased, as reflected by the proportion of higher-valued transactions. In the second half of 2025, 66.7% of shophouse transactions were priced between $5 million and $10 million suggesting a preferred range for landed shophouses. While some landed shophouses transacted below $5 million, they either have a 99-LH tenure, are located outside the Central Region, or are all under 2,000 sq ft. Overall, in the second half of 2025, 67.1% of transactions fall within the $5 million to $10 million range.

Chart 3: Price quantum of landed shophouse in the last ten years

Popularity of the Central Region and Conservation Status Shophouses

Out of the 36 landed shophouses sold in the second half of 2025, 30 were located in the Central Region, a popular area for eateries, fitness studios, and co-living spaces. As a result, owners of Central Region landed shophouses are likely to be able to command higher rents for their properties.

In the second half of 2025, District 8 (Little India) and District 15 (East Coast, Marine Parade) shared the top spot for the highest number of shophouse deals. With nine transactions each, they together accounted for 50.0% of all sales during the period, demonstrating their popularity with buyers. Their proximity to the city centre attracts high footfall from both locals and foreigners, supported by strong demand in hospitality and retail sectors, including food and beverage (F&B) outlets and fitness gyms. Additionally, these districts are popular among expats and tourists due to their cultural charm and heritage. This positions shophouse landlords to secure higher rents, thereby increasing prices. The upper levels of shophouses in these areas can also be converted for hospitality purposes, such as co-living spaces. This added value may have attracted buyers willing to bridge the price gap to complete transactions. 

Meanwhile, both District 7 (Beach Road, Bugis, Rochor) and District 1 (Marina Bay, Boat Quay) recorded four and three landed shophouse transactions respectively. These centrally located properties continue to enjoy steady demand despite higher prices. 

Most notably, three freehold shophouses (203, 205 and 207 Jalan Besar) in the Desker Road Conservation Area were collectively sold for $36.5 million on 24 September 2025. They were initially listed for $44 million in 2024. On the same day, another shophouse at 65 Club Street, located in the Telok Ayer Conservation Area, was sold for $21.0 million, reportedly by a family office established by ARA Asset Management co-founder John Lim. The buyer was Asia Success Management, whose primary business is in single/multiple family office activities.

Conservation shophouses are highly sought after because of their rarity. There are only about 6,500 units of landed shophouses with conservation status, making them difficult to find. Buyers of these properties remain undeterred despite strict guidelines for façade and structural maintenance. These shophouses are also popular among emerging retailers who are attracted to their unique and eclectic charm.

Chart 4: Top five districts by transaction volume in 2H 2025

Table 1: Top five shophouse transactions in 2H 2025

Low-Interest Rate Environment and Investors’ Asset Recycling Strategy Could Set the Stage for More Deals to Come

Shophouses will continue to be in demand from local and international buyers due to their rarity and uniqueness. Without the Additional Buyers’ Stamp Duty (ABSD), investors will still see shophouses as a viable option. Family offices and investors are the most likely buyers, especially if the properties are in the Central Region or have a 999-year leasehold or freehold tenure. Landed shophouses that can be converted for residential use may attract co-living operators looking to expand their portfolios. 

Furthermore, despite ongoing global uncertainties and shifts in trade and capital flows, Singapore remains a stable and appealing investment hub. Singapore’s continuous focus on innovation, its growing network of trade partnerships, and its strong capacity to attract long-term foreign investment will continue to support job creation and economic growth, which are essential pillars underpinning the property market.

The strong Singapore dollar, relatively low tax rates, and political stability make Singapore an appealing market for investors. For these reasons, the landed shophouses are highly coveted by institutional investors and family offices for capital growth and wealth preservation.

Interest rates have been coming down since the end of 2023. In the current low-interest-rate environment, we observe increased interest due to greater affordability. FED rate cuts in 2024 and again in 2025 will continue to boost buyers’ confidence and drive increased sales momentum into 2026. 

Owing to the factors mentioned above, ERA predicts a rebound in landed shophouse transaction volumes. Portfolio and fund managers looking to cash out and reallocate capital into other investments as prices rise could lead to more and larger deals in the future. We might see between 70 to 80 shophouse transactions in 2026, with total transaction values ranging from $550 million to $650 million.