Office rents in the central region fell 3.2 per cent in the fourth quarter last year compared with the third quarter, data yesterday showed.

The decline was strikingly higher than the 0.6 per cent fall from the second to the third quarters.

The office rental index slipped 3.1 per cent in 2019 compared with an increase of 7.4 per cent in 2018.

The data from the Urban Redevelopment Authority (URA) also showed that prices of office space in the central region contracted 0.5 per cent in the fourth quarter, following a 3.9 per cent drop in the third. The price index was down 0.6 per cent for the whole of 2019, contrasting with the gain of 5.7 per cent in 2018.

There was a total supply of about 753,000 sq m gross floor area of office space in the pipeline as at Dec 31, up slightly from the 738,000 sq m at Sept 30. The amount of occupied office space increased by 30,000 sq m in net lettable area (NLA) in the fourth quarter, against the rise of 71,000 sq m in the third.

The stock of office space expanded by 29,000 sq m in NLA in the fourth quarter, compared with a contraction of 4,000 sqm in the previous quarter.

As a result, the islandwide vacancy rate of office space dipped to 10.5 per cent as at Dec 31, from 10.6 per cent as at Sept 30.

THE BUSINESS TIMES