Market Research

• The optics of published vacancy rates portray a picture of ample supply, but that is not the case.
• The completion of IOI Central Boulevard Towers distorted the figures to a degree, as 1.2M sq ft came on stream all at one time.
• However, the building is now 75% committed anyway.
• Most quality buildings have high occupancy and low vacancy rates, limiting tenant choices despite public perception suggesting otherwise.
• Current buildings with the most significant office space available include Marina One East & West, Capital Square and Asia Square.
• The completion of Keppel South Central will add a further 435,000 sq ft to supply.

• Demand for office space has been unpredictable in the past 12 months, but the flight to quality persists while supply lasts.
• IOI Central Boulevard Towers is currently the 'hottest' office development in the market, with an over 75% take-up rate. So, vacancy figures are declining rapidly. In Q2 2024, the take-up rate here was only 25%, which shows how quickly a situation can change.
• The market has become discerning about quality, not budget.
• Sectors that are still active include professional services, law firms, and capital management firms.

Trends: We expect the number of new set-ups securing their new office space to increase, and it is anticipated that more businesses from distressed markets, such as Hong Kong, will be eyeing Singapore as a future growth location.

New developments have been slow to attract pre-commitments from tenants. However, this is the trend now and this is exactly how leasing activity evolved at IOI Central Boulevard Towers. By June 2024 the main West Tower here was only 20% committed after TOP. Since then, leasing activity has taken off and it is now 75% leased.

Office rentals are expected to remain stable for most of 2025, with rates likely firming by 2%–3% as we approach 2026, driven by a projected supply shortage.