Office rents in Singapore’s central region rise at a slower pace of 2.1% in Q3

OFFICE rents in Singapore’s central region rose 2.1 per cent in the third quarter of 2022 over the preceding quarter, a slower pace of increase compared with the 2.4 per cent quarter-on-quarter (qoq) rise in Q2 2022.

This takes the total increase in the Urban Redevelopment Authority’s rental index for office space in the central region to 6.3 per cent in the first three quarters of 2022, following a full-year 2021 increase of 1.9 per cent.

Some property consultants predict that Singapore office rental growth can be expected to slow further in the fourth quarter, with the trend continuing next year as demand starts to weaken amid the uncertain macroeconomic environment. On the other hand, the countervailing factors cited for rental growth include a continuation of tight supply. Moreover, landlords have begun to pass on higher service charges (due to inflationary pressures) to tenants, resulting in higher gross effective rent figures.