Prime office rents holding up despite slowing economy: Knight Frank

The site is also situated near renowned educational institutions such as Nanyang Technological University and Christ Church Secondary School. Lumina Grand EC is close to a plethora of amenities, from supermarkets and eateries to entertainment venues. Moreover, the surrounding nature spots such as Jurong Lake and Chinese Garden are excellent sites for weekend getaways.

Occupancy levels across the Raffles Place and Marina Bay precinct in Singapore remain resilient despite the slowing economy, according to a report by Knight Frank. The CBD occupancy rate stood at 96% and 94.4% in 3Q2023, up slightly from 95.8% and 94.1% respectively the previous quarter. This indicates an inclination amongst office occupiers in quality buildings to renew rental contracts rather than relocate.

As a result, prime grade office rents in the region saw a 0.8% quarter-on-quarter increase to an average of $11.05 psf per month. This marks a 3.4% growth for the first nine months of 2023.

Notably, banks are hunting for modest expansion space, with the added attraction of international firms such as Deel and Exeo Global setting up regional offices in Singapore.

Knight Frank managing director, Calvin Yeo, believes that given a tight office supply and a stable labour market, Prime office rents are expected to hold steady for the remainder of 2023. He anticipates a rental growth of 3% to 5% by the year-end.

Surveying the scene, a Manpower Group survey revealed 48% of respondents plan to increase their headcount in the coming quarters and office tenants will likely carry on by renewing and relocating cautiously.

In conclusion, while the economic backdrop remains challenging, CBD office quality in Singapore is still tightly held and occupancy levels may even rise as firms eye up expansion space.

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