Prime office rents up 0.6% q-o-q in 1Q2024: Knight Frank

Prime business leas in the Raffles Place and Marina Bay district rose to an average of $11.20 psf per month (pm) in 1Q2024, a 0.6% increase q-o-q, according to a report by Knight Frank Singapore launched on March 25.

The rental fee increase was sustained by renewals, maintaining term status tight at 95.6% for the Raffles Place and Marina Bay precinct and 94.7% for the total CBD. Calvin Yeo, managing director of occupant approach and solutions at Knight Frank Singapore, includes that the renewals were completed at a little higher leas as companies opted to stay rather than transferring or broadening to prevent capital expenditure.

On the other hand, Yeo prepares for that organizations ought to approach this year with “cautious positive outlook,” considered that geopolitical tensions present a significant danger to service development and operations. He likewise expects tenancy degrees to continue to be strict at top-notch office buildings that can command a premium, backed by Singapore’s low lack of employment rate and the city-state’s placement as a premier company venue. Knight Frank estimates leas to increase reasonably in between 1% and 3% in 2024.

A brand-new source of prime business offices is also anticipated to be finished this year, raising the presenting supply. This includes IOI Central Boulevard Towers at 2 Central Boulevard, which is anticipated to generate 1.26 million sq ft of workplace, and 33-storey Keppel South Central along Hoe Chiang Roadway in Tanjong Pagar.

However, he believes office rents might smooth out in 2H2024 as tech companies and global banks lay off workers and consolidate organization operations, which might lead to sections of office being reverted upon rent expiry.

Yeo mentions that the demand for prime workplace continues to be high due to the fact that Singapore remains to entice multinational firms. This is because of the broad pool of expertise, tax obligation rewards, a diversified market and modern facilities.

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