Weakening Economy Takes a Toll on Prime Office Space in Singapore
THE weakening economy is starting to take a toll on prime office space in Singapore, according to a new report.
Vacancy rates in these buildings crept higher as rents slipped in the final quarter of last year, said the report compiled by Savills Singapore.
The firm attributes these trends to weakening sentiment in the job market as the economy slows. One important sector that accounts for a large part of office space, the financial services and banking sector, has been hit by the global slowdown.
In the last three months of last year, the vacancy rate among grade A offices in the Central Business District rose to 6.9%, after consistently hovering below the 5% mark for the previous five consecutive quarters.
Offices in the Shenton Way and City Hall areas were the worst hit.
This was largely due to unlet and ‘shadow space’ in newly completed buildings and space vacated by the Citi group in Centennial and Millenia Towers after its move to Asia Square.
Rents were under pressure too.
Savills recorded an average rent of S$8.71 per sq m (RM21) per month for grade A offices for the fourth quarter, down from the S$8.86 per sq m (RM21.4) per month for the preceding three months. — The Straits Times / Asia News Network
By The Star Online