AI to reshape, not reduce, demand for Singapore Grade A offices: C&W
Among the 4 scenarios modelled in its study, Cushman & Wakefield assumes a baseline scenario that thinks moderate productivity gains from steady AI fostering, in addition to stable work levels supported by ongoing hiring in office-intensive sectors.
The series of results shows a “durable” prime office market, with vacancy remaining listed below 5%, noted Dr Dominic Brown, head of international study at Cushman & Wakefield. “It reveals why the impact of AI on property can not be comprehended through jobs alone– supply, productivity, business growth and the modifying role of the work environment all matter.”
In a September research record titled AI Impact: Workplace Insights Singapore, the realty companies firm examined the potential influence of AI adoption on Singapore’s economic situation, labor force and industrial property via to 2030.
“As services reassess exactly how and in which their individuals work, we expect need to turn into much more careful, thus placing an even higher premium on quality, connection and versatility,” she added.
The study evaluated four scenarios with various presumptions connecting to the price of AI adoption, together with economic and labour market effect. The scenarios represent a spectrum of potential results– AI-led productivity growth driving increased demand for office space on one end, and AI-driven labour shift weakening leasing need on the other.
Consequently, as even more businesses move to better work areas, the flight to high quality can expand the existing space between prime and non-prime work areas. According to Cushman & Wakefield, Grade A workplaces command a rental premium of 48% over Grade B workplaces since 2026, increasing from 34% in 2019.
While the expanding adoption of AI is readied to improve just how businesses utilize the office, it is unlikely to dramatically minimize need for Grade An office space in Singapore, according to Cushman & Wakefield.
Based upon the situations, CBD Grade A workplace vacancy in Singapore is predicted to range in between 1.5% and 4.9% by 2030, compared to 4.4% as by the end of 2025. Meanwhile, rental movement for Grade An offices could vary from 6.5% growth to a decline of 2.3% in 2030. In contrast, rental fees expanded by 2.2% in 2025.
Against this background, the firm expects demand for higher-quality offices to be strengthened, even as some work gets changed by AI. “As routine activities become progressively automated, work environments are expected to play a higher duty in collaboration, innovation and client engagement,” Brown discussed.
At the same time, new prime office supply remains minimal, which will better sustain the Grade A market. Cushman & Wakefield jobs vacancy for Grade A workplaces in the CBD to tighten to 3.7% by the end of this year and fall listed below 2% beyond 2029. Meanwhile, rental fees are anticipated to enhance 4.8% this year.
In any case, Singapore’s placement as a center for innovation, specialist services and other knowledge-intensive companies provides it a benefit as AI adoption speeds up, said Natalie Craig, chief executive of Cushman & Wakefield Singapore.
