Singapore Grade A office rents rise for sixth straight quarter in Q2

Monthly rents increased by 0.8% to S$12,50 per sq ft.

Singapore's Core CBD Grade A office market extended its rental growth streak in the second quarter of 2026, with rents rising 0.8% quarter-on-quarter to S$12.50 per sq ft per month despite ongoing economic uncertainty and geopolitical tensions, according to CBRE Research.

The latest increase marks the sixth consecutive quarter of rental growth, taking cumulative gains to 1.6% in the first half of 2026. CBRE has maintained its forecast for approximately 5% year-on-year rental growth by the end of the year, citing continued structural undersupply and signs of improving macroeconomic stability.

Tricia Song, Head of Research, Singapore and Southeast Asia at CBRE, said landlords continue to enjoy significant pricing power as Core CBD Grade A vacancy has fallen sharply from 7.8% in the fourth quarter of 2024, following the completion of IOI Central Boulevard Towers, to a record low of 3.3% in Q2 2026.

"The market's continued performance reflects a structural imbalance between occupier demand and available supply," Song said, noting that the completion of Shaw Tower in the Fringe CBD marks the end of meaningful new office supply in 2026, with no significant completions expected through 2027.

Shaw Tower, which received its Temporary Occupation Permit during the quarter, has secured major tenants including Allianz, Adyen, Sanofi-Aventis Singapore and The Great Room. Together with Keppel South Central, the development provides occupiers with an alternative to the increasingly constrained Core CBD market.

CBRE said leasing demand remained broad-based across sectors and locations. Financial services firms continued to expand, while artificial intelligence companies increasingly moved from flexible coworking spaces into permanent offices, reflecting their long-term commitment to Singapore. Demand also remained active in decentralised markets such as Alexandra and Paya Lebar, driven by occupiers from the public, consumer goods, professional services and education sectors. The withdrawal of HarbourFront Centre from active office stock further tightened market conditions, reducing islandwide vacancy from 5.6% in Q1 to 3.6% in Q2.

David McKellar, Head of Leasing, Singapore at CBRE, said the diversity of occupier demand is strengthening confidence in the market's recovery.

"We are no longer seeing growth carried by one or two dominant sectors," McKellar said. "Financial services remain active, but they are now joined by a meaningful cohort of AI businesses of all sizes, as well as professional services occupiers, among others, in decentralised locations."

CBRE also noted rising enquiry levels from hedge funds, quantitative trading firms and AI companies, with pre-commitment activity for developments due for completion in 2028 and 2029 becoming an increasingly important part of the leasing pipeline as quality office options diminish.

Looking ahead, CBRE expects Singapore's Core CBD Grade A office market to remain supported by tight supply, with potential upside to rental growth should global economic conditions improve in the second half of 2026. The consultancy said Singapore's office market has historically demonstrated resilience through periods of geopolitical and macroeconomic uncertainty, with landlords adopting flexible leasing strategies likely to be well positioned to capture future demand.