Investors invested about HK$14.9 billion on large property transactions in Hong Kong this year, with Singapore the biggest spender, according to FPDSavills. The survey showed foreign investors invested about HK$5.9 billion in commercial and residential properties. The Government of Singapore Investment Corp spent about HK$2.89 billion on three office and residential properties, including the lower block of Millennium Plaza, 15 floors in Cosco Tower, Sheung Wan, and Royal Court on Kennedy Road. Pidemco Land, of Singapore, teamed with New York-listed American International Group to buy 65 per cent of the Furama Hotel for HK$1.88 billion for redevelopment into an office complex. Other foreign institutional investors came from Australia, Britain and the United States. The survey covered 83 property deals each worth HK$50 million or more. FPDSavills said it handled 32 per cent of the deals. Realty managing director Frank Marriot said mainland investors spent about HK$700 million buying commercial properties, with Sanjiu Enterprise buying 8 Wyndham Street in Central for HK$500 million. Mr Marriot expected market outlook to be good next year, especially considering transactions would be boosted by a potential interest-rate cut of up to 75 basis points. He said more foreign capital would enter Hong Kong, and it would serve as a stepping stone for investors entering the mainland market when it joined the World Trade Organisation. Investors would prefer office properties because rents were healthy and grade-A office space was in short supply. Mr Marriot forecast office prices would rise up to 15 per cent next year, while rents would jump as much as 30 per cent. FPDSavills said net grade-A office supply would drop more than half next year, to 445,000 square feet, from this year's 988,592 sq ft. Office supply would increase to 3.1 million sq ft in 2002. The consultancy's investment director Peter Kueh expected more mainland buyers next year because partnerships with Hong Kong businesses made them more familiar with the SAR property market. Unlike foreign investors, he said, mainland investors made their moves quickly once they had located potential acquisitions. Cushman & Wakefield director Simon Chow said foreign spending, excluding the mainland, had jumped nearly 60 per cent this year to HK$6.7 billion. He said foreign investors had shifted buying interest from luxury residential projects to office properties after seeing attractive rent yields and an obvious sector turnaround. Sources said the Hong Kong Monetary Authority was in talks to buy about 200,000 sq ft of office space at Two International Finance Centre in Central. Bank of East Asia also was said to be looking for office space of up to 200,000 sq ft for expansion. These potential deals would involve more than HK$1 billion each.