AS at Q3 2014, Singapore’s office spaces were the 14th most expensive in the world, according to CBRE Research’s biannual Global Prime Office Occupancy Costs survey.
At US$113 per square foot (psf), Singapore’s office spaces are relatively more affordable than its Asian counterparts.
Ranked second most expensive, Hong Kong Central’s office space stood at US$251 psf, while Beijing’s Finance Street and central business district (CBD), ranked third and fourth respectively, cost US$198 psf and US$189 psf.
Asia alone accounted for seven of the top ten markets. Other Asian countries making the list were India (New Delhi’s Connaught place – CBD) and Japan (Tokyo’s Marunouchi Otemachi).
Topping the list was London’s West End district, which recorded US$274 psf.
“Notwithstanding Singapore’s strong rental growth last year (up 14.7 per cent), the city’s current office occupation cost does not appear out of step with comparable global business centres,” said Moray Armstrong, executive director of CBRE’s office services.
But in terms of occupancy costs growth, Singapore ranked fifth, recording a 16.5 per cent increase in occupancy cost from Q1 2014 to Q3 2014.
Mr Armstrong said: “The Singapore office sector performed within expectations in 2014 with rental levels advancing off low prevailing vacancy rates.
“Looking ahead, limited availability of office space will continue through 2015 with relief to occupiers only when the next wave of major new supply arrives in H2 2016. In these circumstances we anticipate further rental growth particularly in the early part of the year. The pace of rental growth may slacken later in 2015 and going into 2016 as the impact of sizeable future supply becomes apparent,” he added.
CBRE tracks occupancy costs for prime office space in 126 markets around the globe.