Prime office rents up 0.6% q-o-q in 1Q2024: Knight Frank
The lease buildup was sustained by resumptions, maintaining term levels tight at 95.6% for the Raffles Place and Marina Bay precinct and 94.7% for the general CBD. Calvin Yeo, running executive of occupant approach and answers at Knight Frank Singapore, adds that the revivals were completed at a little higher leas as companies preferred to remain instead of relocating or developing to keep away from capital expenditure.
Yeo mentions that the need for prime workplace stays steep because Singapore continues to appeal to global firms. This is because of the vast pool of expertise, tax benefits, a diversified overall economy and modern-day facilities.
A brand-new supply of prime office spaces is also expected to be completed this year, raising the occurring amount. This includes IOI Central Boulevard Towers at 2 Central Blvd, that is expected to generate 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 companies should approach this year with “cautious positive outlook,” considered that geopolitical tensions position a considerable threat to organization growth and operations. He also expects occupancy degrees to stay firm at quality office buildings that can command a premium, backed by Singapore’s minimal joblessness level and the city-state’s placement as a premier operation place. Knight Frank estimates rents to increase moderately between 1% and 3% in 2024.
Prime business leas in the Raffles Area and Marina Bay district increased to approximately $11.20 psf monthly (pm) in 1Q2024, a 0.6% increase q-o-q, according to a report by Knight Frank Singapore released on March 25.
However, he believes workplace leas might flatten out in 2H2024 as tech companies and worldwide banks lay off workers and combine business operations, which could bring about portions of office being returned upon contract expiration.
