Singapore’s office rents are set to rebound from their first annual decline in three years as new supply shrinks and more businesses expand, according to the biggest office property trust in Asia outside of Japan.
Rents in the city are reaching a trough and demand may rise as the country positions itself as a regional business hub, said Lynette Leong, chief executive officer of CapitaCommercial Trust (CCT), Supply for the next three years will be about 0.8 million square feet a year, down from 1.3 million square feet over the past two decades, she said.
“Rents are poised for a recovery,” Leong said in an interview in Singapore on Jan. 24. It’s “a no-brainer that rents are not going to go down very much further so it’s more when the rents will turn and to what extent,” she said.
Ranked by the World Bank as the easiest place to do business for a seventh year, the country that’s smaller than New York City is also emerging as Asia’s wealth management center, driving demand for banking services with an increase of millionaires. Singapore office rents are the 19th-highest globally, according to CBRE Group Inc., and are cheaper than Hong Kong, Tokyo, Beijing and New Delhi.
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