Singapore’s office market performed better than expected in 2025. Central Business District (CBD) investment-grade office rents climbed 3.8%, an improvement from the 2.5% growth recorded in 2024, while capital values rose 4.9% in 2025, nearly triple the 1.6% growth achieved in 2024.

This robust performance reflected the market’s underlying strength and investor confidence, showcasing that the office sector has successfully navigated recent headwinds to enter a new growth story.

Economic tailwinds drive market confidence

The office market’s resilience was fundamentally supported by Singapore’s economic outperformance. GDP expanded by a strong 5% in 2025, while interest rates dropped to their lowest levels in three years. This favourable macroeconomic environment created the ideal conditions for both occupiers and investors to make strategic moves in the office market.

Figure 1: Singapore real GDP growth and Singapore Overnight Rate Average (SORA)

Note: SORA is based on average of period rates
Source: Singstats, Oxford Economics, JLL Research

Broad-based demand fuels leasing activity

Office space demand recovered further in 2025, driven mainly by recentralisation trends and flight-to-quality activities. The banking and non-bank financial services sectors led the charge, alongside professional and business services firms and emerging technology companies.

The flight-to-quality trend became especially pronounced as companies prioritised modern, well-connected office buildings that could attract and retain talent as more digital natives entered Singapore’s highly competitive job market.

Institutional investors return to the market

Perhaps the most significant development in 2025 was the return of institutional investors to Singapore’s office investment market. After remaining largely on the sidelines for three years due to high interest rates, major institutional players came back with renewed confidence. Office investment sales volume reached a three-year high of nearly SGD 4 billion in 2025, approaching the SGD 6 billion peak achieved in 2022.

The second half of 2025 (H2 2025) saw particularly active deal-making, highlighted by several landmark transactions. They included the SGD 1 billion sale of a 55% stake in CapitaSpring, Keppel’s SGD 462 million acquisition of JEM’s office component, and Keppel REIT’s SGD 1.45 billion purchase of an additional one-third interest in Marina Bay Financial Centre Tower 3.

The surge in office transactions in H2 2025 ended the three-year dominance of the retail and industrial sectors in the non-residential investment sales market.

Figure 2: Singapore non-residential investment sales transactions

Note: Comprises private sector deals worth at least SGD 5 million and all properties sold by the government,
regardless of value, excluding deals with no price information.
Source: REALIS, POWERdesQ, RCA, URA, JTC, JLL Research

Supply constraints support future growth

Looking ahead, the limited new office supply provides strong support for continued market growth. New office space across the island will total only about 4 million square feet from 2026 to 2030. CBD supply constraints are even more pronounced, with only 2.2 million square feet scheduled for delivery over five years. This averages less than 0.5 million square feet a year, which is below the 10-year average annual net take-up of 0.6 million square feet. Major 2026 completions are limited to Shaw Tower’s redevelopment, which is already 22% pre-committed.

The combination of limited supply through 2027 and continued demand from international firms seeking regional diversification positions Singapore’s office market for stable to modest growth in the near to medium term. This outlook remains intact as long as recent geopolitical and tariff uncertainties do not significantly affect the broader economy.

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