Prime office rents rise in 3Q2025 amid limited supply and flight-to-quality moves
Calvin Yeo, head of tenant strategy and solutions at Knight Frank Singapore, watches that “selective upgrades to top quality space have actually produced a two-tier market where newer, well-connected buildings flourish and older supply encounters growing vacancy pressure.”
” Singapore’s office industry has been holding up well, in part supported by stronger-than-anticipated economic fundamentals and a more favorable interest rate atmosphere,” states Dr Chua Yang Liang, head of study and consultancy for JLL Southeast Asia.
Given the unclear global atmosphere, Knight Frank expects sentiment to stay mindful amongst office tenants over the following six to year. “Therefore, prime rental growth for the last quarter of 2025 is expected to remain fairly level with some marginal development, with even more of the exact same going into the first half of 2026,” the record states.
Knight Frank’s report found that occupancy levels for office spaces in the Raffles Place and Marina Bay district stayed unchanged at 94.7%, whilst overall CBD tenancy grown from 93.7% in 2Q2025 to 94.2% in 3Q2025.
Given the limited office stock in the following few years, he anticipates high quality buildings to remain almost totally inhabited as even more companies make flight-to-quality moves from older structures. On the other hand, older and poorly connected buildings will face increasing pressures to be redeveloped or modernised.
The higher growth was primarily credited to the addition of IOI Central Blvd Towers to the basket of real estates checked by JLL. Excluding IOI Central Blvd Towers, CBD office rents increased by lower than 1%, on par with the last six quarters.
Rents for top office in Singapore kept on expanding in 3Q2025, based on study from real estate consultancies. In its most current quarterly workplace industry report, JLL’s research presents that Grade A workplace leas in the CBD improved 1.3% q-o-q to $11.83 psf monthly (psf pm) previous quarter, the biggest quarterly growth in 6 quarters.
The minimal available supply, paired with a cautious business setting, resulted in leasing activity being predominantly driven by lease renewals, claims Knight Frank. Nevertheless, select occupiers, particularly those with concluding leases, are choosing to move to newer, better-quality buildings in tandem with right-sizing or measured growth. Examples of these consist of tech business Zoom Communications transferring from Asia Square Tower to IOI Central Blvd Towers, whilst quantitative trading firm Jane Street is preparing to increase its area in the latter.
Looking forward, JLL prepares for CBD Grade A office rental development to remain modest for the rest of 2025, with full-year growth projected to reach approximately 3%. Entering into 2026, JLL predicts workplace rental development to pick up rate, assisted by a tightening up supply pipeline. “As vacancy rates are projected to tighten in between 2025-2027, whole-floor and multi-floor prospects will certainly come to be progressively minimal, potentially driving rental rates beyond some renters’ budget parameters,” remarks Andrew Tangye, head of office leasing and advisory for JLL Singapore.
In a separate report, research study by Knight Frank suggests prime grade office rental fees in the Raffles Place and Marina Bay spots grew 0.3% q-o-q to hit approximately $11.41 psf pm in 3Q2025. This resembles the 0.2% q-o-q development recorded in 2Q2025, and brings total rental development for the initial nine months of the year to 0.4%.
