Current occupiers are more likely to renew their lease contracts than to relocate.

According to a report by Knight Frank, prime Grade office rents in Singapore’s Raffles Place / Marina Bay precinct rose 0.8% q-o-q and 5.1% y-o-y in Q3 2023, averaging S$11.05 psf pm. 

The slowing economy did not deter office rents from holding up, with prime office rents growing a moderate 3.4% in the first nine months of 2023. In the remaining months of the year, prime office rents are expected to maintain as CBD office supply will continue to remain tight. 

Here’s more from Knight Frank:

Occupancy levels in the Raffles Place / Marina Bay precinct, and in the overall CBD were healthy at 96.0% and 94.4% respectively in Q3 2023, remaining relatively stable from the corresponding levels of 95.8% and 94.1% in the previous quarter. 

Most office occupiers in quality office buildings in the CBD were generally more inclined to renew their rental contracts due to cost efficiencies compared to relocation. Post pandemic, the office as a relevant focal point for workplace productivity remains critical for many aspects of business operations, thereby keeping occupancy levels tight.