Singapore CBD Grade A office rents to remain flat in 2025

Meanwhile, AAA-grade rents could increase by 2%.

The Singapore office market has so far weathered the raft of negative externalities from the ills afflicting the tech industry since 2022 according to Savills, challenging business conditions facing companies in general and the impact artificial intelligence has on worker numbers.

“In our previous briefings, we mentioned that the relative lack of new supply had been key in keeping rents rising. However, as we enter the second quarter of the year, whether the office rents can remain resilient against the uncertainties brought on by the US tariffs remains the question. We believe that it may still be able to hold up,” the analyst said.

Here’s more from Savills:

With the latest addition to our CBD Grade A supply of office buildings steadily being taken up, and existing buildings sporting low vacancies, the pressure on rents remains low. Given the surprise that tariffs were applied to Singapore, and the uncertain outcomes from the negotiations with the US, the situation is still very fluid.

It is not just about how the tariffs directly impact us, but the interactions they have amongst countries and the cross correlations to Singapore. As the landscape of global trade is in the process of being redefined, it is difficult at this early stage to arrive at a new global optimum for trade. All this could mean that for the next two quarters, tenants are likely to sit it out and adopt a conservative approach regarding expansion, relocation or simply renewing their lease.

With the flux arising from the tariff negotiations in mind, we maintain our forecast for the overall Grade A CBD office rents, expecting them to remain flat in 2025. As vacancy levels amongst most of the premium AAA-grade buildings are very low, they may still be able to eke out a 2% YoY increase.