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Singapore is now the 14th-most expensive office market in the world, and the most expensive in the Asia-Pacific region.
Singapore jumped eight places to enter the world’s top-20 most expensive office markets this year as prime office occupancy cost rose 17.3 percent year-on-year during the first quarter of 2019, revealed a CBRE report.
Sitting at 14th place globally, the city-state secured the top spot in the Asia-Pacific region.
“Office market fundamentals there remained robust, with tightening vacancy and strong absorption,” said CBRE in its 2019 Global Prime Office Occupancy Costs report. “Prime occupancy costs should continue to increase as landlords remain optimistic on the outlook for rents, supported by less new office supply in the medium term.”
Globally, prime office occupancy cost rose 3.6 percent in Q1 2019, way higher than last year’s 2.4 percent growth and CBRE’s forecast of two percent.
“All regions had increased growth rates in prime office occupancy costs from the prior year,” said CBRE. “APAC’s growth rate nearly doubled to 3.3 percent, while EMEA had a healthy increase to 3.5 percent and the Americas increased to 3.7 percent.”
Hong Kong Central remained the world’s most expensive office market location, followed by London’s West End.
CBRE noted that all 10 most expensive location in 2018 remained in this year’s top ten list, though some shifts were seen in the top six.
Two Beijing markets – Finance Street and Beijing CBD – fell in rank to fifth and sixth place from third and fifth, respectively. Hong Kong (Kowloon) climbed one spot to third, while New York (Midtown Manhattan) jumped to fourth from sixth.
Of the 122 markets tracked by CBRE, 85 registered increases in occupancy costs.
“For the markets with the biggest increases, a few distinct drivers of demand emerged over the past year,” said CBRE.
“Most have limited supply of available product, especially for premium big-block requirements. These markets are increasingly attractive, characterized by desirable central locations with modern infrastructure and transit options as well as prime social amenities.”
Victor Kang, Digital Content Specialist at PropertyGuru, edited this story. To contact him about this or other stories, email victorkang@propertyguru.com.sg
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