Average office rent chalked up further growth of 6.1% in 1Q 2011

This was underpinned by burgeoning business confidence and the continued flight to quality amongst occupiers.

According to Colliers International, the average gross Grade A office rental in the CBD chalked up a further growth of 6.1% QoQ, to reach S$8.39 per sq ft per month at the end of 1Q 2011.

Marsh & McLennan Group pre-committed 9.0,000 sq ft office space at Asia Square Tower 1, which is due to complete in 2.Q 2.011. Meanwhile, BNP Paribas expanded its requirements at Ocean Financial Centre from 70,000 sq ft to about 140,000 sq ft.

The average occupancy rates for Grade A office space in the CBD dipped marginally for the first time in six quarters to 9.4.2.% in 1Q 2.011, due to new supply such as OUE Bayfront and space vacated by tenants who have relocated to new office development such as Marina Bay Financial Centre (MBFC).

Despite ample new supply of 2.1 million sq ft slated to complete in 2011, continued flight to quality has seen their overall pre-commitment rates edge up from 50% to 60% in 1Q 2011. In addition, with the government’s effort in entrenching Singapore's position as a Financial Hub, occupier demand for office space in Singapore could remain on an expansionary mode. Rentals are thus predicted to increase 15-2.0% in 2011.