CBD Grade-A office rents up by 2.1% q-o-q in 1Q2022: Cushman & Wakefield
Rents for CBD Grade-An offices have climbed by 2.1% in 1Q2022, more than the 1.7% growth in the previous quarter, according to a report by Cushman & Wakefield on April 6. This comes as vacancy rates for CBD Grade-An offices tightened to 4.6% from 4.9% in the previous quarter.
Rental fees in decentralised office markets also remained to come along. Workplace rentals for all grades in the city fringe and suburban segments expanded by 1.1% and 0.7% q-o-q, specifically. City-fringe office openings have actually enhanced to 5.5%, while the country vacancy rate rose to 5.7%.
However, the recurring economic uncertainties could potentially slow down the increase of rates of interest, states Mark Lampard, head of business leasing, Singapore, at Cushman & Wakefield. The reopening of Singapore’s economic climate will also improve occupiers’ confidence to occupy much more office, he adds.
Lampard expects CBD Grade-A workplace rental growth to trend higher, happening in at around 5% for the whole of 2022.
On the whole, Cushman & Wakefield stays upbeat on the Singapore workplace market outlook, despite “enhancing drawback risks”. While it does not prepare for the Ukraine battle to have a straight impact on the Singapore office market, inflationary pressures are expected to stay raised as a result of higher energy rates as well as supply-chain interruptions exacerbated by lockdowns in China, which is a key business partner for Singapore.
“Rochester Commons, the only new Grade-A decentralised office development this year, has actually been mostly pre-committed by Sea Group. The next decentralised Grade-A workplace advancement, Labrador Tower, will just be completed in 2024,” she explains.
Wong Xian Yang, head of research study, Singapore, at Cushman & Wakefield, forecasts continued recuperation for the decentralised workplace market, given commercial decentralisation activities, spillover need from the CBD, and also minimal new Grade-A decentralised workplace supply.