Slump in office and shop rentals deepens in Q1: URA data

People walking outside Raffles Place MRT in the Central Business District (CBD) area.
People walking outside Raffles Place MRT in the Central Business District (CBD) area. PHOTO: ST FILE

SINGAPORE - It was more gloomy times for office and retail landlords, as prices and rents for both markets weakened further in the first quarter.

Office prices fell 0.3 per cent from the end of last year, representing a 0.6 per cent decline from its last peak in the second quarter of last year.

The drop in office rents gathered pace however as they slipped 2.1 per cent after falling 1.8 per cent in the fourth quarter.

Office rents have now fallen 9 per cent over four quarters, since they last peaked.

Landlords would be heartened as vacancy rate moderated 0.3 percentage points to 9.2 per cent in the first quarter.

However, pipeline supply rose by 1.6 per cent as well to about 1.0 million sqm of gross floor area.

Prices of retail space slipped 1.9 per cent after falling just 0.1 per cent in the previous quarter. They are now 2.8 per cent below their last peak in the first quarter of last year.

Retail space rents also slid more quickly than before, falling 1.9 per cent compared with 1.3 per cent previously.

Retail space rents have now fallen for five straight quarters and are 6.0 per cent below their last peak in the fourth quarter of 2014.

Vacancy rate for retail space rose 0.1 percentage points to 7.3 per cent in the first quarter, while pipeline supply fell 3.1 per cent to 783,000 sqm in gross floor area.