SINGAPORE – Office rents in Singapore’s central region continued rising in the first quarter of this year as pipeline supply shrank, data released by the Urban Redevelopment Authority (URA) showed on Friday.
Rents for office space rose 5.1 per cent in the first quarter of 2023 over the fourth quarter of 2022, the same increase as in the previous quarter. Central office rents have been moving upwards since 2021.
Prices of office space in the central region were flat in the first quarter, compared with the 3.7 per cent increase in the previous quarter.
Islandwide, at the end of the first quarter, the total supply of office space in the pipeline came to about 837,000 sq m of gross floor area (GFA), a 4 per cent fall from the 872,000 sq m at the end of the previous quarter.
Net demand, as measured by the amount of occupied office space, rose by 21,000 sq m in the first quarter of 2023, compared with an increase of 9,000 sq m in the previous quarter.
The stock of office space also increased by 14,000 sq m in the first quarter of 2023, after contracting by 23,000 sq m in the previous quarter.
As a result, the islandwide vacancy rate of office space declined to 11.2 per cent as at end-March, from 11.3 per cent as at the end of December.
Retail rents, meanwhile, dipped 0.3 per cent in the first quarter, a smaller decline after the 1.1 per cent drop in the fourth quarter of 2022.
Prices of retail space in the central region fell by 0.9 per cent following a 2.1 per cent decrease in the previous quarter.
On an islandwide basis, as at the end of the first quarter, there was a total supply of 407,000 sq m of GFA of retail space from projects in the pipeline, down 3.1 per cent from 420,000 sq m as at the end of the fourth quarter of 2022.
The amount of occupied retail space fell by 7,000 sq m of net lettable area (NLA) in the first quarter, compared with an increase in NLA of 66,000 sq m in the previous quarter. The stock of retail space increased by about 25,000 sq m of NLA in the first quarter of 2023, a slightly larger increase than the 24,000 sq m increase in the previous quarter.
This resulted in the islandwide vacancy rate of retail space rising to 7.6 per cent as at end-March, from 7.1 per cent as at the end of December. THE BUSINESS TIMES
