CBD Grade A office rents climb 2.1% QoQ in Q122

By yearend, analysts expect rents to trend higher to about 5%.

Grade A office rents in the central business district (CBD) climbed 2.1% QoQ in Q122, data from Cushman & Wakefield showed. Last quarter rents grew 1.7% QoQ.

Given the increase in rents, vacancy rates of CBC Grade A offices dipped in the same quarter to 4.6% from 4.9% in Q421.

Meanwhile, City Fringe (all grades) and Suburban office rents also grew, though at a gradual pace, in Q1. The former saw rents go up by 1.1% QoQ, whilst the latter’s rents grew 0.7% QoQ.

While both markets saw an increase in rents, only the City Fringe office’s vacancy rate declined in Q1 (5.5%) as suburban vacancy rates inched higher to 5.7%.

Looking ahead, C&W said it expects CBD Grade A office rents to “trend higher” at about 5% YoY in 2022 on the back of the reopening of Singapore’s economy, and an expected slower increase in interest rates due to economic uncertainties.