Tenants from financials used to dominate with 47% market share but now comprise 21% of the pie.
This chart from JLL shows how the composition of new office tenants in Singapore's commercial market changed in the last 13 years.
In the 10-year period between 2004 to 2014, tenants from the financial services sector dominated the market with a 47% share, but in 2015-2017, they just comprised 21% of the pie. Technology companies came to take the crown as their market share rose from 8% in 2004-2014 to 32% in 2015-2017.
Data revealed that office net take-up is around 6% for the first quarter of the year, significantly higher than the 2-3% rates observed in 2017. Demand in Singapore, wherein occupiers from technology, e-commerce, and flexible space operators moved into new supply.
Major leasing deals signed by technology companies in 2017 included Facebook and Grab for 250,000 sqft and 100,000 sqft of space, respectively, in Marina One.
Meanwhile, the share of tenants in the professional services sector increased from 5% to 13%. Increases were also seen in tenants from real estate (3% to 7%) and pharmaceuticals (5% to 6%).
The office market was joined by less oil & gas (O&G) tenants as they fell from 10% to 7%. This also reflected in tenants from manufacturing (4% to 3%) and insurance (7% to 2%). Tenants in "other" sectors accounted for 11% in 2004-2014, but in 2015-2017, they fell to 9%.
JLL said that Singapore Grade A CBD office net absorption reversed the declining trend of 2015 and 2016 to hit a three-year high in 2017. This continued into 2018, as the take-up in the first three months of the year already broke the record in 2017.
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