Rents for CBD Grade A office buildings edged up 1.9% to $8.64psf

Rental growth has rocketed.

According to Savills, in Q4/2013, the average rent of Savills basket of CBD Grade A office buildings stood at S$8.64 per sq ft per month, representing a 1.9% increase QoQ. 

Rental growth has accelerated rapidly during the quarter, driven by the higher rents achieved for smaller spaces, especially in the Grade AAA office buildings located in the Marina Bay area.

Here's more from Savills:

Rents in most micro-markets, including Raffles Place/Marina Bay, Shenton Way, Tanjong Pagar and Beach Road/Middle Road, rose faster in Q4 compared with the previous quarter.

This bears out our observation that Grade A office rents are in an upswing phase.

2013 saw a turnaround in overall CBD Grade A office rents, with a 3.9% growth after a contraction of 4.7% in 2012. Monthly rents at Grade AAA office buildings surged 8.3% YoY, closing at S$10.83 per sq ft in Q4. For Grades AA and A office space, rents rose to S$9.14 per sq ft and S$8.05 per sq ft respectively, representing more moderate annual increases of 3.1% and 2.7%.