Office market strained as tech, Chinese firms secure excess CBD space

The city’s high-specification office fit-outs cost around $4,899 per sq m.

Singapore’s office market is facing rising pressure from space constraints as multinational firms, particularly Chinese companies and technology groups, continue to expand their footprint in the central business district.

A Turner & Townsend report said some occupiers are taking more space than they currently require for future expansion, and may hold on to space they don’t need during a downturn.

“This naturally leads to inefficiency, and money goes into acquiring and maintaining space more than fitting it out,“ it added.

Despite elevated demand, fit-out costs remain relatively competitive compared to Western financial centres. High-specification office fit-outs in Singapore cost around $4,899 per square metre.

Data from the report showed high-specification reception and welcome areas cost about $6,686 per square metre, whilst staff dining and breakout areas reached $6,856 per square metre.

Meeting rooms cost approximately $6,589 per square metre under high-specification designs, whilst boardrooms reached $6,748 per square metre.

Open office layouts remained comparatively cheaper, with high-specification fit-outs costing around $4,076 per square metre.

Turner & Townsend said companies are continuing to redesign office layouts to accommodate flexible and hybrid work arrangements.

“Increasingly, the city is seeing a demand for mixed-use space, adding residential and leisure space into the same core locations that might traditionally have been office-focused,“ it added.