Prime office rents up 0.6% q-o-q in 1Q2024: Knight Frank
The rent buildup was sustained by renewals, keeping occupancy status tight at 95.6% for the Raffles Place and Marina Bay precinct and 94.7% for the total CBD. Calvin Yeo, running director of tenant approach and services at Knight Frank Singapore, adds in that the revivals were accomplished at somewhat greater rental fees as business opted to remain as opposed to moving or developing to avoid capital expenditure.
Meanwhile, Yeo anticipates that organizations ought to approach this year with “mindful confidence,” given that geopolitical tensions present a significant threat to company growth and procedures. He additionally assumes tenancy degrees to continue to be firm at top-notch office complex that can regulate a premium, backed by Singapore’s low unemployment level and the city-state’s setting as a premier operation area. Knight Frank estimates leas to expand moderately between 1% and 3% in 2024.
Prime business rents in the Raffles Area and Marina Bay precinct went up to approximately $11.20 psf each month (pm) in 1Q2024, a 0.6% raise q-o-q, according to a statement by Knight Frank Singapore released on March 25.
A new supply of prime offices is even expected to be finished this year, increasing the remaining supply. This consists of IOI Central Blvd Towers at 2 Central Boulevard, which is expected to bring in 1.26 million sq ft of workplace, and 33-storey Keppel South Central along Hoe Chiang Road in Tanjong Pagar.
Yeo mentions that the demand for prime workplace stays high since Singapore remains to attract global companies. This is due to the wide pool of expertise, tax incentives, a diversified economy and modern-day infrastructure.
Nevertheless, he thinks workplace leas may straighten out in 2H2024 as tech companies and worldwide financial institutions lay off workers and settle company operations, which could result in parts of office space being moved back upon contract expiry.
