S’pore 3rd costliest office location in Asia-Pac

Singapore remains one of the costliest office locations in the Asia Pacific, according to a new report from Colliers International.
The study ranked the most expensive office markets in the region for Q1 2013, based on annual gross rents expressed in US dollars. Hong Kong topped the list at US$112.86 (S$142.84) psf, followed by Tokyo and Singapore with US$93.24 (S$118.01) psf and US$81.19 (S$102.75) psf respectively.
Sydney, Perth, Beijing, Brisbane, Shanghai, Hanoi and Ho Chi Minh City rounded up the top 10.
Colliers said leasing momentum in Singapore’s CBD “stayed relatively muted in Q1 2013, dominated by renewal deals and tenants’ flight to quality”.
The report noted that average occupancy rates for premium grade office space in the Raffles Place/New Downtown micro-market increased to 90.2 percent in Q1 from 88.5 percent in the previous quarter. However, average occupancy in the wider CBD fell to 93.6 percent from 94.5 percent during the same period.
In terms of monthly gross rents, CBD Premium and Grade A office space eased another 0.7 percent to S$8.41 psf in March.
“Weighed down by downside risks on the global economic front, CBD office rents are expected to stay on a downtrend in 2013, but improving local market fundamentals could cap the fall in office rents to less than five percent for the whole year,” the report said.
“In the leasing market, corporate tenants will remain largely cost-conscious over the near term until there are more concrete signs of recovery in global demand, perhaps in the latter half of 2013. Given the low interest rate environment, the overall sales market is expected to remain dominated by cash-rich occupiers who are motivated to consider buying for long-term own-use.”
Meanwhile, Colliers expects governments across the region to introduce additional stimulus measures aimed at improving economic growth.

Source Prop Guru – 30 MAy 2013

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