Decentralised office rents fall as firms relocate to CBD: JLL
As relocations carry on to support need, workplace leas in the CBD are anticipated to remain modest, with JLL anticipating full-year development of 2% this year. Nevertheless, rental fees may pick up in 2025, amid limited supply. “No significant office completions are anticipated for the following 12 months, with the new Shaw Tower only entering onstream in 2H2026,” notes Chua.
Andrew Tangye, head of office leasing and advisory at JLL Singapore, claims a growing pattern of “strategic recentralisation” and “quality-driven moves” to offices in the CBD. “Many services in Singapore are developing towards higher-value offerings and improved company models, causing a migration of some office demand from decentralised places to CBD facilities that far better accommodate their significantly sophisticated and client-oriented procedures,” he adds.
The redevelopment of 79 Anson Road, which could begin next year, is anticipated to worsen supply constraints further, he adds.
Regardless of ongoing economic and geopolitical unpredictabilities, CBD office rents edged up again in 2Q2025. Grade A gross effective rental fees climbed 0.7% q-o-q to $11.69 psf monthly, observing a 5th straight quarter of sub-1% growth, according to JLL.
On the other hand, office rents in the decentralised sub-market reported a decline in 2Q2025, its very first fall in four years. Rental fees in the market dropped 0.8% q-o-q to $7.61 psf each month last quarter. “This decline is attributed to ongoing rightsizing efforts and occupants relocating to, or closer to, the CBD, driven by the boosted opportunity of space,” JLL adds.
Meanwhile, Tangye believes proprietors with uninhabited area are concentrating on enhancing occupancy and securing portfolios ahead of 2026, when leas might start increasing once more prior to brand-new supply gets in the marketplace in 2028. He adds: “By implementing targeted property enhancements, including modernised lobbies and bathrooms, along with the repair and remodelling of outdated office areas, homeowner are placing themselves to bring in costs lessees and capitalise on the expected rental growth opportunities.”
A lot more business might be obliged to move to the CBD because of “the current absence of a significant rental fee space between CBD and decentralised offices”, claims Dr Chua Yang Liang, JLL’s head of study and consultancy for Southeast Asia. Currently, the average rental fee gap in between investment-grade workplaces in the CBD and the decentralised sub-market stands at around 30% to 35%, that Chua says is below the historical 50% to 60% range.
One instance is Audi Singapore, which most recently relocated its office spaces from Aperia on Kallang Avenue to Capital Square in the CBD. The shift accompanied the showroom’s shift from Alexandra Road to 18 Cross Street, just a short stroll from Capital Square, states Tangye.
