Prime office rents up 0.6% q-o-q in 1Q2024: Knight Frank
Yeo indicates that the interest for prime office remains steep because Singapore continues to attract international corporations. This is due to the broad pool of capability, tax incentives, a varied market and contemporary facilities.
On the other hand, Yeo anticipates that companies need to close in this year with “careful confidence,” considered that geopolitical stress position a considerable risk to organization development and operations. He likewise assumes occupancy levels to stay tight at top-notch office buildings that can control a premium, supported by Singapore’s small lack of employment level and the city-state’s position as a premier business location. Knight Frank estimates rents to grow reasonably between 1% and 3% in 2024.
The rent increase was maintained by resumptions, keeping term levels close at 95.6% for the Raffles Place and Marina Bay precinct and 94.7% for the total CBD. Calvin Yeo, managing director of occupant strategy and services at Knight Frank Singapore, adds in that the renewals were accomplished at slightly greater rents as business opted to hold instead of relocating or widening to prevent capital expenditure.
Prime office space rental fees in the Raffles Place and Marina Bay precinct rose to approximately $11.20 psf per month (pm) in 1Q2024, a 0.6% increase q-o-q, according to a statement by Knight Frank Singapore published on March 25.
A brand-new supply of prime office spaces is also anticipated to be finished this year, boosting the existing supply. This includes IOI Central Blvd Towers at 2 Central Blvd, which is anticipated to bring in 1.26 million sq ft of workplace, and 33-storey Keppel South Central along Hoe Chiang Roadway in Tanjong Pagar.
However, he thinks workplace leas might straighten out in 2H2024 as tech companies and international banks lay off team and settle company operations, which might lead to sections of workplace being reverted upon rent expiry.
