Office rental growth slows

Rents for prime commercial properties are continuing to moderate.

The deteriorating economic outlook has also seen Grade A office rental growth slow to its weakest pace in a year.

Singapore’s office property market cooled further in the third quarter.

Colliers International said Grade A office rents in the CBD grew by a marginal two per cent in the quarter to S$9.08 per square foot per month.

Rents in Raffles Place and the new downtown area did rise by a higher 3.6 per cent to S$10.77 on the strength of new buildings like Ocean Financial Centre and OUE Bayfront.

However, the occupancy level in this micro market fell to 90.9 per cent — a level not seen since 2005.

Colliers said the office property market could see businesses hold back on capital expenditures which could impact new occupier demand.

Rents in the prime retail property sector have stayed largely unchanged.

DTZ said the average gross fixed rent of prime first-storey space in the Orchard/Scotts Road area increased by 0.5% quarter-on-quarter to S$40.20 per sq ft per month in the third quarter.

Source : Channel NewsAsia – 27 Sep 2011

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