Developers here are building more office space in the city’s suburbs as companies including Credit Suisse and Deutsche Bank shift some operations away from downtown to cut costs, according to Cushman and Wakefield.
The city’s supply of suburban office space is expected to rise to 920,000 sq ft in 2014, five times the 190,000 sq ft that is expected to be completed this year, the world’s largest privately held property services company said.
About 44 per cent of office space will be in the suburbs by 2014, up from 6 per cent now, said Cushman and Wakefield’s Singapore-based vice-chairman Donald Han.
CapitaLand, Singapore’s largest listed property developer, said its largest investment commitment this year is a S$1.5 billion office and retail building in the western part of the country.
Rents in the central business district are 2.3 times those in the outskirts, according to Government data. Leasing costs are rising, making Singapore the third most expensive in the Asia-Pacific region in the second quarter, Colliers International said.
“There are a lot of these companies that are now bracing themselves for higher costs, pending a rise in rentals over the next few years,” said Mr Han. “They have to find cheaper options to average down their costs.”
Source : Today – 6 Aug 2011