SINGAPORE - DBS Group Holdings is paying $1.035 billion for a stake in Marina Bay Financial Centre (MBFC) Tower 3, the site of its new headquarters.
The move will help the bank cut its rental costs and place DBS in the heart of Singapore's new financial district.
The bank told the Singapore Exchange yesterday that it has bought 30 per cent of Central Boulevard Development, a consortium that owns Tower 3.
The deal means DBS will now receive dividend income to help offset the rental expense.
DBS chief executive Piyush Gupta said: "The decision... enables us to better manage our occupancy costs in the long term."
Tower 3 has 46 storeys with about 1.35 million sq ft of prime Grade A office space.
DBS is the anchor tenant, having completed its move there in October.
It occupies 18 floors, or more than 600,000 sq ft.
This transaction marks DBS' return to owning its premises.
It was leasing its previous headquarters in Shenton Way after selling the two towers to a Goldman Sachs real estate fund for $690 million in November 2005.
Overseas Union Enterprise paid $870.5 million to buy the towers in August 2010.
A Savills Singapore valuation report last month valued one-third of Tower 3 at around $1.137 billion.