In a deal that is set to become the largest office transaction Singapore has ever seen, the Qatar Investment Authority has agreed to buy Asia Square Tower 1 for $2.5 billion (S$3.4 billion) from BlackRock, the world’s largest asset manager.

Asia Square Tower 1 is located in the central area of Singapore and offers over 116,000sqm of leasable office space on 43 floors. It has Citigroup as its anchor and other tenants such as KKR & Co. and Google.

According to Bloomberg, the building has been on the market since last year after bids by a consortium of Norway’s sovereign wealth fund and CapitaLand Ltd., Singapore’s largest developer, and rival bids by ARA Asset Management Ltd. failed to clinch the deal.

Reports state that the sale comes as vacancy rates in Singapore’s office property sector are nearing their highest level in almost a decade, with the supply of commercial space set to increase amid slowing economic growth. Nonetheless, John Saunders, head of Asia-Pacific for BlackRock Real Estate, explained in a phone interview with Bloomberg:

“There has been a lot of near-term negativity on the Singapore market…I think it’s a little bit overdone. There is some new stock coming on, but what tends to happen in Singapore is you get a big piece of supply that temporarily can disrupt the market, but then demand is always usually pretty strong.”

BlackRock was advised by real estate consultant firms JLL and CBRE.