BNP Paribas to cut space in Keppel Reit’s Singapore tower as high rents bite

BNP Paribas is set to give up space in a prime office tower in Singapore amid rising commercial rent in the financial hub, according to sources familiar with the matter.

The French bank, which currently occupies six floors at Ocean Financial Centre, plans to not renew some of the space in the Central Business District (CBD) when the lease expires at the end of the year, the sources said, requesting not to be named because the matter is private. The move will help curb costs, they added.

From the fourth quarter, the bank will also move at least 300 mostly back-end staff at 20 Collyer Quay to Mapletree Business City – a business park located in the country’s south – to free up the location for those affected by the cut in floor space, the sources said. The plans are not final and could change, the sources added.

Companies are seeking to control costs, as the city-state’s commercial rents rise on the back of an influx of wealth and family offices. Prime office space in the CBD surged in Q1 to a 15-year high, according to data from JLL.

BNP Paribas, which has about 2,000 staff in Singapore, declined to comment in an emailed statement. Keppel Real Estate Investment Trust (Reit), which has a majority stake in the 43-floor Ocean Financial Centre, did not immediately respond to an emailed request for comment.

The business park, which has about 2.9 million square feet (270,000 square metres) of lettable space, is owned by Mapletree Pan Asia Commercial Trust, a Reit backed by Singapore investment company Temasek. The Reit declined to comment.

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Major banks in Singapore have long preferred to locate their back-end staff outside the city centre, where rents are cheaper. Venues such as Changi Business Park count Standard Chartered, Citigroup and DBS Group Hldgs as tenants.

Social media giant Meta Platforms is planning to give up seven floors in Singapore’s South Beach Tower later this year, The Business Times reported in February. BLOOMBERG