LEASING office space in Singapore’s central business district (CBD) became more expensive last year but the local market is still one of the cheapest among major cities in the Asia-Pacific region, property consultancy Cushman & Wakefield said in a report on Friday.
The overall occupancy cost for CBD office space here climbed 9.8 per cent to US$93 per square foot (psf) per year last year from the year before on the back of a supply crunch, Cushman said.
This was 49 per cent cheaper compared with Hong Kong’s CBD, where total occupancy costs came in at US$184 psf per year in 2014.
Total occupancy cost takes into account rents, service charges and local taxes that the tenant has to pay.
Hong Kong had the most expensive office space in the Asia-Pacific region last year, followed by New Delhi and Tokyo, according to Cushman’s estimates.
Singapore was in seventh place, below Shanghai.
Cushman said that Singapore CBD office rents are likely to rise by another 5-6 per cent this year, due to broad-based leasing demand and few completions of new developments.
However, it added that rents may stabilise next year due to a bumper crop of new office space scheduled to be completed.
About four million sq ft of new space from major projects such as Marina One in Marina Bay, DUO Tower in Bugis and Guoco Tower in Tanjong Pagar will come onstream in 2016.