Singapore - Singapore still has the third most expensive office rentals in Asia Pacific even though its annual gross rents fell by 22% last year due to the economic crisis.
According to Colliers International's latest global office real estate review, annual occupancy costs in Singapore dropped from US$125 (S$189.68) per square foot in the first six months of 2008 to US$97 (S$147.18) in the second half. Despite falling rents across Asia Pacific, Singapore remains the sixth most expensive city for businesses tenants globally.
Yet the city's office rental costs are still much cheaper than Hong Kong and Tokyo, the first and second most expensive cities in the Asia Pacific ranking. Local rents were 45% cheaper than Hong Kong and 24% cheaper than Tokyo, Tay Huey Ying, director of research and advisory at Colliers International told Straits Times.
Hong Kong's office rents fell by 16% to US$178 (S$270) per square foot, while Tokyo's rents went down by half a percent to US$128 (S$194.22).
The demand for office space in Singapore is however slowing. The review, which tracks office performance across 172 cities worldwide, said vacancy rates had risen 1.4 percentage points to 8.9% in the second half of 2008. It also expects the demand for office space to further decline in 2009 along with Singapore's shrinking economy.
