While Singaporean office rents continue to rise, they are not quite at their all time peak levels, with Grade A office rent still 36 per cent below its 2008 all time high, according to recent research form the Real Estate Developers’ Association of Singapore. Average Grade A rent in the Raffles Place area continues to top S$10.40 (US$8.66) per sq ft, according to Today Online.
Prices remain high, but vacancies are hard to come by, with approximately 96 per cent of Grade A office space occupied. This high occupancy rate is having an effect on suburban markets as well, which have seen their prices rise as inner city space is unavailable.
Cushman & Wakefield vice-chairman Donald Han said the “rental recovery of Grade A office space is on the back of sustained vacancy decline”. This is brought about by Singapore’s economic rebound, especially in the financial and business services sectors.
Quite a number of major pre-commitments have been made to suburban offices this year. For example, the Ministry of National Development will be taking up some 315,000 sq ft at Jurong Gateway, while Deutsche Bank and Nike will be taking 120,000 sq ft each at Mapletree Business City.
He added that the lacking of car-parking space in the financial district may also be a potential push factor.
