After a year of stagnant growth, Singapore’s Core Central Business District (CBD) office rents have seen a resurgence in Q1 2025, with a 0.8% increase in gross effective rents, according to CBRE. The average rent now stands at S$12.05 per square foot per month, driven by strong demand for premium office spaces in prime locations.
Tricia Song, CBRE’s Head of Research for Singapore and Southeast Asia, noted the continued preference among top corporations and private wealth asset management firms for prime office spaces. “We can see this in the low vacancies in buildings that meet both criteria, and also the fact that spaces within such buildings offering unblocked views persistently establish new record rents,” she said.
Despite a slight increase in vacancies from 4.9% to 5.3%, largely due to non-renewals by major occupiers like Meta and Morgan Stanley, the demand for prime buildings remains robust. David McKellar, CBRE’s Head of Office Services, highlighted the rapid absorption of space in the newly completed IOI Central Boulevard Towers, where occupancy has exceeded 80%.
In the investment market, office transactions fell by 80.8% to $159.33 million in Q1, with the largest deal being the $91.8 million sale of the top three floors of 20 Collyer Quay. Michael Tay, CBRE Singapore Advisory Deputy Managing Director, attributed potential future interest to falling interest rates and the extension of the Central Business District Incentive and Strategic Development Incentive.
Looking ahead, CBRE Research anticipates a 2-3% growth in Core CBD (Grade A) rents this year, outperforming 2024’s 0.4% growth. However, global trade conflicts and tariffs pose risks to business sentiment. Despite these challenges, Song remains cautiously optimistic, citing Singapore’s reputation as a stable investment market.
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