Singapore's historic shophouses, once symbols of the past, are now highly coveted as thriving urban assets. Their vibrant facades and intricate details have turned them into trendy establishments, from restaurants to boutiques, appealing to both locals and tourists. These structures have gained immense value, thanks to their exemption from housing regulations designed to curb costs. Sales of shophouses have surged, with Chinese investors making significant acquisitions. As Singapore has shifted towards preserving its historical heritage, areas like Joo Chiat have transformed into vibrant districts, attracting visitors and social media enthusiasts. These shophouses are now home to global brands and prestigious dining venues, exemplifying a harmonious blend of tradition and modernity.
Historically, Singapore boasts around 6,500 shophouses with conservation status, dating back to the colonial era from the 1840s to the 1960s. Originally catering to merchants and their families, these structures transformed into shared dwellings as waves of immigrants settled in Singapore.
Mirroring the trend of revitalizing brownstones in Brooklyn and Victorian terraces in London, shophouses have transitioned from urban relics to coveted symbols of sophisticated city living. Adorned with vibrant facades, intricate plasterwork, and sheltered walkways, these structures are now sought after for trendy establishments such as hipster restaurants, bars, and boutique hotels. In the wake of the post-pandemic resurgence in tourism, these shophouses have become lucrative assets in Singapore's real estate landscape.
Singapore's endeavours to control housing costs are fuelling demand. In April, the city-state imposed additional levies on locals buying second homes and foreign buyers acquiring residential properties, aiming to temper a heated market. Shophouses, primarily categorized as commercial, enjoy an exemption from these regulations. Shophouse prices have soared to a record S$5,500 ($4,000) per square foot, surpassing even Manhattan's Upper Fifth Avenue, the world's priciest shopping street in 2022.
Sales of shophouses surged by 44% to S$415 million in the second quarter, according to Knight Frank LLP, with projections by Mary Sai anticipating sales to reach up to $1.5 billion in 2023. Notably, a Chinese investor made the year's largest deal, acquiring a row of six shophouses in Boat Quay for $80 million. Soh, who receives weekly unsolicited offers for each shophouse in his family's portfolio, highlights the escalating rents, which have tripled in the past three years.
Renovating a shophouse is often an expensive and time-consuming process due to the building's age and a complex set of conservation rules. Following Singapore's independence in 1965, many traditional villages and low-rise structures yielded to modernization. Yet, in the 1980s and '90s, the city-state shifted its focus towards preserving its historical heritage, leading to the conservation designation of buildings in historic areas like Chinatown and Little India.
The Joo Chiat neighbourhood, once associated with seedy establishments and worn-down shophouses, has transformed into one of Singapore's vibrant and highly Instagrammable districts. During weekends, young people and tourists can be seen exploring its vibrant shophouse-lined streets, capturing selfies.
In April, Coach, a prominent fashion brand, inaugurated its largest concept store globally in a three-story shophouse. Notably, several of the island's finest dining establishments, such as Björn Frantzén's three-Michelin-starred Zen and the popular local spot Kok Sen, are also situated in shophouses.
The transformation of Singapore's historic shophouses from relics of the past to coveted symbols of modern city living is an emblematic success story. The surge in post-pandemic tourism has turned them into lucrative assets, thanks to their exemption from housing regulations aimed at controlling costs. Singapore's dedication to preserving its historical heritage has allowed neighbourhoods like Joo Chiat to evolve into vibrant districts, capturing the imaginations of both locals and tourists. Shophouses are now the backdrop for international brands and Michelin-starred dining, showcasing their unique blend of tradition and modernity.
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