CBD office rents hit five-year high; premium office rents to keep rising through 2027: Savills

SINGAPORE: Grade A office rents in Singapore’s Central Business District (CBD) climbed to a five-year high in the third quarter (Q3), with Savills Singapore expecting premium office rents to keep rising through 2027 amid a limited supply of Grade A spaces, Singapore Business Review reported.

Savills’ executive director Alan Cheong said premium office rents are likely to continue rising by 2% to 3% annually over the next two years, supported by sustained occupancy levels and a tight pipeline of new developments.

CBD’s Grade A office rents rose 0.8% quarter-on-quarter (QoQ) to S$9.93 per square foot (psf) as new office supply was limited and occupancy stayed high, while concerns over interest rates began to ease. Year-on-year (YoY), Grade A office rents grew at the fastest pace since the fourth quarter (Q4) of 2022, up 2.1%.

The increase was led by Grade AAA office rents, which climbed 1.0% to S$13.19 psf, the highest since early 2015. Meanwhile, Grade AA and A spaces gained 0.7% and 0.8% to S$10.85 psf and S$8.81 psf, respectively. Marina Bay recorded a ten-year high, with rents rising 1.1% to S$13.17 psf. /TISG

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