Singapore prime office rents up 6.1% in Q2

Singapore recorded the eighth highest annual growth in Grade A office rents during Q2 2018 among 19 regional cities tracked by Knight Frank.According to the property consultancy, monthly office rents in Raffles Place and Marina Bay rose by 6.1 percent year-on-year to $8.40 psf. On a quarterly basis, Grade A office rents there edged up 0.8 percent as landlords raised rents due to tapering supply.Looking ahead, prime office rents in Singapore are expected to increase over the next 12 months.Meanwhile, Sydney led the pack, posting a 13.3 percent yearly rental growth during the second quarter, followed by Manila (10.6 percent) and Bangkok (9.9 percent).Clinching fourth and fifth spots are Bengaluru (8.5 percent) and Hong Kong (6.7 percent), respectively. Completing the top seven are Melbourne (6.5 percent) and Tokyo with 6.3 percent.On the other hand, Kuala Lumpur was among the laggards with monthly Grade A office rents dipping by 2.5 percent to RM5.9 psf (S$1.96 psf). Similarly, Shanghai was the worst performer with a drop of 3.1 percent.Overall, Knight Frank’s Asia Pacific Prime Office Rental Index gained 2.4 percent quarter-on-quarter in Q2, exceeding the 0.9 percent increment seen in Q1 2018.“Steady demand seen in the prime office market is expected to bolster rental growth for the second half of the year. Despite several headwinds, including tensions around trade, regional economic growth continues to fuel demand for Grade-A office space,” said Nicholas Holt, Knight Frank’s research head for Asia Pacific.Source: CommercialGuru, 5 September 2018