CBD Grade A vacancy to fall to 4.2% in 2025

This is amidst limited new supply and recovering demand.

Grade A office vacancy rate in the Central Business District (CBD) is expected to fall to 4.2% at the end of 2025 and fall further to under 4% in 2026.  

This is amidst limited new supply and recovering demand and the 4.7% rate in the third quarter (Q3) of 2025, Cushman & Wakefield said in its Singapore Market Outlook report.

The 2026 Grade A office vacancy rate is also the lowest in over a decade, excluding 2023, it added.

The end-2025 rate will fall below the 4.6% recorded at the end of 2024.

The majority of new office developments since 2024 have been fully or nearly fully leased.

Meanwhile, the trend of speculative fit-outs for select units that have been well received may continue as some occupiers remain cost-conscious amidst persistent economic uncertainty, the report noted. 

This followed Savills’ findings, which said that the vacancy rate for CBD Grade A offices in Q4 2024 increased by 1.8 percentage points quarter-on-quarter to 8%, the highest level since Q1 2018, when it stood at 8.8%.

Meanwhile, Newmark anticipated that rental growth would have remained positive in 2025 as occupiers focused on workplace efficiency and employee experience, driving interest for prime spaces.

Amidst these trends, a potential rise in office demand matched with lower interest rates could start a constrained supply pipeline, giving the advantage to landlords, Cushman & Wakefield said.