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Singapore recorded the largest drop in prime office rent across the Asia Pacific (APAC) region during the first quarter, according to the latest report from Knight Frank.
In Q1 2016, average prime office rent in the city-state declined by 4.4 percent quarter-on-quarter, and rents there are expected to fall further over the next 12 months.
“Singapore continued to be mired in a double whammy of significant supply and weak demand,” said the report.
The region’s other laggards for the first quarter were Taipei (-0.2 percent), Kuala Lumpur (-0.4 percent) and Perth (-1.6 percent).
Meanwhile, Tokyo posted the highest rental growth of 3.4 percent, followed by Seoul (2.6 percent) and Beijing (2.5 percent). Completing the top five are Shanghai and Bangkok with prime office rental growths of 2.3 percent and 2.2 percent, respectively.
Overall, Knight Frank’s prime office rental index for Asia Pacific climbed by 1 percent in Q1 2016, accelerating from 0.2 percent in the previous quarter, as average vacancy dipped by 0.2 percentage points.
“While the macro-economic story across the region remains uncertain, office markets have tended to see rents hold up fairly well over recent months,” said Knight Frank’s Head of Research for Asia Pacific, Nicholas Holt.
“Despite our longer term forecasts suggesting we are nearer to the top of the rental cycle in many markets, the next 12 months will see further rental growth in the majority of markets tracked as tight supply and steady demand prevails,” he added.
Nikki De Guzman, Editor at CommercialGuru, wrote this story. To contact her about this or other stories email nikki@propertyguru.com.sg
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