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Singapore prime office rents saw a 1.2 percent in Q3 2014, the fifth highest figure in the Asia Pacific (APAC) region, according to Knight Frank’s latest report.
This represents the fifth consecutive quarter of positive gains and an eight percent increment from a year ago. Knight Frank also noted that the city-state’s quarterly net absorption reached a two-year high.
“Backed by stable economic growth and positive business sentiment, Singapore’s office property market continues to see healthy leasing activity over the last three quarters,” said Alice Tan, Head of Consultancy & Research at Knight Frank.
“Coupled with limited supply of new quality office spaces, rental growth of prime office spaces in the Central Business District continued its upward trajectory as landlords seek higher rents.”
However, Tan noted that tenants are resisting higher rents, while relocation activity increased in recent months and is likely to gain momentum as tenants actively scout for new premises outside core CBD locations.
Looking ahead, rents of prime office spaces in the republic are expected to rise by 10 percent for the whole of 2014, but it could see a slower growth of six to seven percent by next year, added Tan.
Meanwhile, the only five markets in Asia Pacific that recorded a higher quarterly rental growth than Singapore are Tokyo with 6.4 percent, followed Bangkok (2.1 percent), Hong Kong (1.6 percent) and India’s Bengaluru with 1.4 percent.
Overall, Knight Frank’s index for prime office rents in the region inched up by 1.2 percent, following a dip in Q2 2014.
Nikki De Guzman, Editor at CommercialGuru, edited this story. To contact her about this and other stories, email nikki@propertyguru.com.sg
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