Grade A office rents in Singapore declined driven by the premium segment

Specifically, those in Shenton Way / Tanjong Pagar.

The Core CBD Premium & Grade A office rents went down after nine consecutive quarters of growth (-0.1% QOQ) during the third quarter (Q3) of 2023 to reach $11.51 per sq ft, Colliers said in a recent report.

This was attributed to the Premium segment, particularly those in Shenton Way / Tanjong Pagar. 

Meanwhile, rents for the Core CBD Grade A segment retained their growth due to resilient demand and limited supply, amidst a continued flight to quality. 

Grade A rents in the Fringe CBD and City Fringe “appear to be catching up as tenants seek financially attractive options near the CBD.”

Mr Bastiaan van Beijsterveldt, Managing Director of Singapore at Colliers, said macroeconomic weakness contributed to the softening of rents.

“However, they remain supported by stable market fundamentals leading to tight vacancy. As near-term market dynamics come into play, such as quality fitted-out spaces coming to market and occupancy pressures, opportunities may arise for occupiers to take advantage of these,” he added, saying firms should revisit their strategies.