Singapore’s office market saw continued leasing activity at the start of 2026, with vacancy tightening more significantly for prime office properties

• Positive leasing momentum from 2025 has carried into the CBD office market in Q1 2026, as a shrinking supply of new, high-quality space compels occupiers to secure locations for new and expansionary needs.
• The Marina Bay submarket led the drop in vacancy rates as tenants increasingly compete for buildings that enhance employee experience and advance sustainability objectives. This heightened demand saw some spaces being re-let even before the current occupants vacate.

Limited near-term pipeline will reinforce low office vacancy

• The drop in office vacancy was also supported by a lack of new supply, as there were no major office completions during the quarter.
• Near-term office supply remains limited. Shaw Tower is slated for completion in mid-2026, while the refurbished Robinson Point and Cecil Place will re-enter the market in late 2026. Following this, Newport Tower and Solitaire on Cecil are expected in 2027.

Growth in rents and capital values moderates amid headwinds

• Office rent growth continued in Q1 2026 but was unable to sustain the growth momentum of H2 2025, with quarter-on-quarter gains falling back to the sub-1% region as renewed tariff uncertainties and geopolitical tensions disrupted the recovery.
• Capital value growth also eased on the back of heightened market risks.

Outlook: Limited supply and steady demand to support rents and price growth but prolonged geopolitical tensions is a key risk

• The combination of a tight supply pipeline and broadening office demand, fueled by Singapore’s appeal as a safe and resilient hub that attracts firms looking to diversify into Southeast Asia, is set to drive continued growth in rents and capital values.
• However, this positive outlook is tempered by the risk that sustained high energy costs could raise business cost, erode business confidence and slow the pace of both economic and office property market growth.