Prime office rents up 0.6% q-o-q in 1Q2024: Knight Frank
Prime office space rents in the Raffles Area and Marina Bay district increased to an average of $11.20 psf monthly (pm) in 1Q2024, a 0.6% increase q-o-q, according to a report by Knight Frank Singapore published on March 25.
Nevertheless, he believes office space rents may straighten out in 2H2024 as tech firms and worldwide banks lay off workers and settle company functions, which can cause sections of office space being moved back upon contract expiration.
The rent buildup was maintained by renewals, keeping tenancy status close at 95.6% for the Raffles Place and Marina Bay precinct and 94.7% for the overall CBD. Calvin Yeo, managing director of occupier strategy and solutions at Knight Frank Singapore, includes that the revivals were completed at somewhat higher leas as business chose to stay as opposed to moving or widening to avoid capital investment.
Yeo indicates that the need for prime workplace stays high because Singapore remains to attract global companies. This is due to the broad pool of capability, tax obligation benefits, a diversified market and modern-day facilities.
A brand-new supply of prime offices is also expected to be completed this year, boosting the occurring amount. This consists of IOI Central Blvd Towers at 2 Central Blvd, that is anticipated to produce 1.26 million sq ft of office space, and 33-storey Keppel South Central throughout Hoe Chiang Road in Tanjong Pagar.
Meanwhile, Yeo prepares for that establishments ought to close in this year with “careful confidence,” considered that geopolitical stress present a significant danger to service growth and procedures. He likewise anticipates inhabitance levels to remain firm at superior office buildings that can command a premium, reared by Singapore’s minimal joblessness rate and the city-state’s position as a premier business area. Knight Frank estimates leas to increase reasonably in between 1% and 3% in 2024.
