The supply of office space for lease is definitely getting tighter and forward-thinking tenants, with leases coming up for review in the next 18 months, will already be thinking where future stock will be coming from. New developments in the pipeline are very limited indeed, with only three office schemes scheduled for completion within the Financial District in the next 12 months, namely:
Building | Area | TOP | Rental Rate (Approx.) |
Hub Synergy Point, Anson Road | 117,500 sq ft | July 2022 | $9.00 per sq ft |
Guoco Midtown, Beach Road | 770,000 sq ft | Dec 2022 | $12.00 per sq ft |
IOI Central Boulevard, Shenton Way | 1,290,000 sq ft | Sep 2023 | $14.00 per sq ft |
Therefore, tenants will have to also consider which buildings currently have the widest choice available and which buildings will be seeing major anchor tenants relocating, leaving significant voids in the building. Examples in the latter category are outlined below:
Building | Tenant Moving | Timing | Size |
Hong Leong Building | KPMG | Q3 2022 | 10 floors | MBFC Tower 1 | Standard Chartered Bank | Q4 2022 | 8 floors | Centennial Tower | SMBC | Q1 2023 | 6 floors | The Concourse | Boehringer Ingelheim | Q1 2023 | 2 ½ floors | UOB Plaza II | Millennium Capital | Q1 2023 | 3 floors | Parkview Square | Toyota Tsusho | Q2 2023 | 2 ½ floors |
Tenants should also keep in mind which other buildings still have the widest choice available, which include the following buildings:
Building | Space Available | Estimated Effective Rate (psf) | 30 Raffles Place | 4 floors | $9.50 - $10.00 | 78 Shenton Way | 3 floors | $8.00+ | Asia Square Tower 1 | 3 floors | $12.50+ | PLUS, Cecil Street / Raffles Place | 4 floors | $10.00 | Twenty Anson | 4 floors | $9.00 |
By the middle of next year, tenants could be surprised by the limited amount of choice available, which in turn is likely to drive up rates. The watch word here is plan well in advance and allow a greater degree of flexibility when selecting a preferred location, otherwise your options will be restricted.