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Singapore posted the strongest rental growth in Q2 2014 compared with other Asia Pacific cities, with average Grade A office rents in the Central Business District (CBD) climbing 4.6 percent to US$828 (S$1,000) per square metre per annum, according to JLL’s latest Office Index.
On a yearly basis, average Grade A office rents in Singapore rose 15.9 percent – making it the only city with a double-digit growth.
JLL noted that the limited number of newly completed buildings and recovery in demand buoyed landlords’ confidence, which eventually resulted in rental growth.
“The short term tight supply has given landlords the confidence to push up rents,” said Dr Chua Yang Liang, Head of Research for South East Asia.
“However with the impending supply coming in 2016, this growth is likely to be clipped by about end 2015. The upside will come from the growth in e-commerce, IT support and FMCG sectors that could continue to grow on the back of heightened consumption in Asia with increasing affluence,” he added.
Notably, the 4.6 percent quarterly growth in office rentals pushed Singapore to the third most expensive destination in Asia Pacific, following Hong Kong and Beijing.
Hong Kong posted the most expensive Grade A office rents of US$1,493 per square metre per annum, followed by Beijing, where Grade A office rents stood at US$996 per square metre per annum.
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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