The rents in Singapore central business district (CBD) surged 19.29 per cent last year. However, office space is still considered more affordable when compared to other major financial centres. Singapore office rent is 803 euros (S$1,389) per square metre (psm) per year while the office rent of other major financial centres (i.e. New York's Madision and 5th Avenue, London's West End, Hong Kong's Central district and Tokyo's CBD) aregoing at 993 euros - 2,122 euros. According to the 2014 ranking, Singapore is the 11th most expensive location by country. London is the most expensive office market, followed by Hong Kong. Singapore was the seventh most expensive location in Asia Pacific and Hong Kong remains the most expensive location in Asia Pacific, followed by Beijing and Tokyo.
The rental growth was driven by demand from professional services and technology sectors. Singapore is the third largest rental increase in Asia Pacific. The prime rent for Jakarta and Bangkok rose 20 per cent. However, market experts said that rents will remain competitive with the strong urban planning and new upcoming supply which include Marina One, DUO and CapitaGreen. Competitive rents will allow for business expansion, job creation and economic prosperity.
In 2013, the global office rents rose 3 per cent, while the rents in Asia Pacific increase by 2 per cent. The rental level of Asia Pacific in 2014 is expected to be similar to 2013 supported by the stable demand. China, Japan, and South-east Asia are expected to drive the rental level of Asia Pacific as the demand for office space starts to gain momentum.
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