Singapore saw the sharpest declines in office rentals in the first quarter amid the global downturn, compared to other Asian markets.
A report from real estate consultancy firm CB Richard Ellis (CBRE) said leasing activity remained slow as firms continued to downsize and reduce costs.
Singapore saw an 18.6 per cent drop in rents for the first three months of 2009, compared to the previous quarter. This is the highest decline in the region.
The second highest fall was recorded in Hong Kong, where rents declined by 14 per cent on-quarter.
Despite the weak performance in the first quarter, CBRE said there are signs that demand is stabilising and business sentiment is turning slightly more positive.
Nonetheless, the consultancy firm said market outlook remains challenging and the decline in rentals is expected to continue.
It believes the pace of decline will slow and leasing activity will begin to pick up, especially when companies become more certain about their short-term business plans.
Source : Channel NewsAsia – 4 May 2009