Singapore CBD office vacancy hits a nine-quarter low

Vacancy fell to 5.6% during Q2.

Vacancy across Singapore's CBD Grade A office market, excluding new completions, fell to a nine-quarter low of 5.6% in the second quarter of 2026 as occupiers continued to absorb premium space faster than landlords could deliver it, according to JLL.

The consultancy said the tightening vacancy reflects sustained demand for quality office space, despite overall CBD vacancy edging up from 6.3% to 6.7% following the completion of Shaw Tower. JLL said the increase was driven by the addition of new stock rather than weakening leasing fundamentals, with the market remaining firmly supply constrained.

Against that backdrop, Singapore's CBD Grade A office market entered its sixth consecutive year of rental growth - the longest expansion cycle on record. Gross effective rents rose 1.1% quarter-on-quarter to SGD12.19 per sq ft per month in Q2 2026, accelerating from 0.5% growth in the previous quarter.

Marina Bay remained the market's strongest-performing precinct, with IOI Central Boulevard Towers and other prime office buildings nearing full occupancy. Major occupiers completing relocations included Databricks, which quadrupled its Singapore footprint to 32,000 sq ft, alongside A&O Shearman, Franklin Templeton and Virtu Financial.

Leasing activity was also supported in the Shenton Way-Tanjong Pagar precinct, where Keppel South Central attracted tenants relocating ahead of the redevelopment of 79 Anson Road, including JTB Singapore, OOCL and Wan Hai Lines. JLL said the completion of the Prince Edward Road MRT station and the full Circle Line loop in July 2026 will further improve accessibility and support rental growth in the area.

Michael Glancy, Country CEO, Singapore and Southeast Asia at JLL, said occupiers are increasingly securing premium office space well ahead of their immediate requirements.

"The flight-to-quality narrative has evolved from a trend into a structural reality," Glancy said, highlighting Shell's pre-commitment of around 100,000 sq ft at Asia Square Tower 1 and Databricks' expansion at IOI Central Boulevard Towers as evidence that companies are moving quickly to secure large, high-quality floorplates.

JLL said demand is broadening beyond financial services, with artificial intelligence, technology, fintech, insurance and professional services firms becoming increasingly active in the leasing market. The consultancy also pointed to OpenAI's planned SGD300 million investment to establish its first Applied AI Lab outside the United States in Singapore as further evidence of the country's growing appeal as a regional technology hub.

According to Dr Chua Yang Liang, Head of Research and Advisory for JLL Southeast Asia, Singapore's economic resilience, political stability and government focus on AI and high-value industries continue to underpin long-term office demand.

With Shaw Tower representing the only major Grade A office completion in 2026 and Newport Tower the only significant non-strata project due in 2027, JLL expects tight supply conditions to persist until the next wave of developments arrives in 2028. The consultancy maintained its forecast for CBD Grade A office rents to increase by around 4% in 2026, with cumulative rental growth of approximately 15% expected by 2030.