Outlook 2023 Singapore

KEY MESSAGES BRISBANE SINGAPORE

SUPPLY

DEMAND

RENTS

KEY OUTLOOK

 Singapore’s CBD Grade A office market faces a relatively tight supply over the medium term.  New CBD Grade A office supply is expected to average 0.7 million sf per annum (2023-2027), this compares with a 10-year annual average of about 1.0 million sf. After bumper supply in 2023, supply tightens in 2024 and 2025.

 Amidst a flight to quality, 2023 is expected to see relatively healthy net absorption of about 0.9 million sf, similar to 2022 levels.  CBD Grade A vacancy is expected to tighten to 4.4% by end-2022 and expand again to 5.4% in 2023 due to slower demand and higher supply in 2023

 Despite global economic uncertainty, CBD Grade A office rents is expected to grow in 2023 as vacancy rates remain relatively tight.  Rents are forecast to grow by 6.1% yoy in 2022, before slowing to 3.1% yoy in 2023.  CBD Grade A office rents to reach SGD10.41 sqft/mo at the end of 2022, and to SGD10.73 sqft/mo at the end of 2023, surpassing pre pandemic levels.

 Though a weaker global economic outlook would weigh on the Singapore office market, an ongoing flight to quality, and Singapore's attractiveness as a regional headquarters in Asia Pacific and South-east Asia for companies will be supportive of the CBD Grade A office market.

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