This is called 'shadow space' - office space that technically has been leased out to a tenant, except that that tenant now wants to sublet it to someone else because he has too much of it.

More and more companies, particularly financial institutions, are looking to sublet 'shadow space', according to a new Colliers International study.

Many have shelved expansion plans or scaled down operations in light of the current economic crisis, and do not want to keep paying rent for space that they no longer need.

Colliers estimated that 'shadow space' rose another 48 per cent from an estimated 250,000 sq ft in March to 370,000 sq ft last month. That is equivalent to the size of the 30-storey MAS Building in Shenton Way.

While it may represent only 0.5 per cent of Singapore's islandwide office stock, it is about 15 per cent of the 2.5 million sq ft of new office space expected to come onstream this year.

And the number is still growing.

This unexpected overhang of excess space could delay an anticipated recovery in office rents, said Colliers.

Some 42 per cent of the space is in the Raffles Place and Marina Bay area, with 24 per cent in the Marina and City Hall area and the remainder in the Shenton Way and Tanjong Pagar areas.

Nearly half of all the 'shadow space' currently being marketed is offered by financial institutions, which went through an explosive growth period earlier but were among the first to downsize their operations in the downturn. Citibank is among those with idle space - at buildings such as Millenia Tower, Centennial Tower and Capital Square.

Read the full story in Thursday's edition of The Straits Times.

joyceteo@sph.com.sg