Office space rentals dip but prices stay level

1Q12 saw office space rentals dive 0.5% while average prices kept the same, but what else is in store for this property sector?

Expect office space supply to grow in the coming quarters as GLS sites and Marina Bay plots come to the market, says the Urban Redevelopment Authority in a release:

Here's more from URA:

Prices and Rentals. Rentals for office space, based on leases which had commenced, decreased by 0.5% in 1st Quarter 2012, compared with the increase of 0.3% in 4th Quarter 2011. Prices of office space remained unchanged in 1st Quarter 2012, compared with the 1.0% increase in the previous quarter.

Supply in the Pipeline. As at the end of 1st Quarter 2012, there was a total supply of about 762,000 sq m GFA of office space in the pipeline. More supply of office space will also come from the GLS sites which were sold by the Government in 2011. This includes the commercial sites at Robinson Road / Cecil Street and Peck Seah Street / Choon Guan Street. In addition, more supply of office space is also expected from the development of the 6 plots of land at Marina Bay and Ophir Road / Rochor Road to be jointly developed by M+S Pte Ltd.

Stock and Vacancy. The amount of occupied office space increased by 53,000 sq m (nett) in 1st Quarter 2012, as compared to the increase of 50,000 sq m (nett) in the previous quarter. On the other hand, the stock of office space increased by 97,000 sq m (nett) in 1st Quarter 2012. The island-wide vacancy rate of office space as at the end of 1st Quarter 2012 increased to 11.7%, from 11.3% as at the end of 4th Quarter 2011.