Published:
Fears rise over vacancy woes in Singapore's office market
Rentals to come under pressure.
According to Maybank Kim Eng, looking ahead to 2014 and beyond, weit sees vacancy risks and prime office rental pressures on the horizon with the impending completions of new office buildings in the CBD/Central area.
Here's more:
We note that it took a good five years from 2009 for ~6m sq ft of supply in the Downtown Core (including Downtown@Marina Bay) to be absorbed. There will be another similar onslaught (~6m sq ft) in 2013-2017, which means rentals will continue to come under pressure.
In our view, there is limited upside for office REITs from rental reversion; hence, we believe it is still too early to buy into the turnaround story.
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