Tech sector to spur office leasing activity in 2024: expert

2024 will see 2.9 million sq. ft. of new office supply.

Technology firms rightsizing office spaces will spur leasing activity in 2024, EDMUND TIE said.

Apart from the technology sector, the injection of 2.9 million sq. ft. of new office supply will also boost leasing activities this year.

"Central Boulevard Tower and Keppel South Central that are slated to be completed in Q12024 and Q4 2024, respectively, will bring approximately 1.8 million sq ft in office supply to the CBD area. This might result in an increase in relocation activity in the CBD area, as corporations remain interested in greener buildings in the mid to long term," EDMUND TIE said.

In 2023, occupancy rate in the CBD increased to 95.2%, 1.3 percentage points higher than the 2022 record.

Average occupancy rates for Premium and Grade A office spaces in CBD remained high at 97.3%, increasing by 0.4 percentage points from 96.7% in 2022. 

For 2024, Edmund Tie expects a 0.3-0.5% growth for Premium and Grade A office rents in the CBD.

Meanwhile, islandwide net absorption of offices increased to 1,228,000 sq ft in 2023 from 445,000 sq ft in 2022.

EDMUND TIE attributed the increase to the introduction of Guoco Midtown and the demand for quality CBD office spaces.