Savills Research has updated its forecast for Singapore’s office rental growth in 2026, predicting an increase of 3% to 5% year-on-year, up from the previous estimate of 2%. This revision is attributed to limited supply and sustained occupancy levels in the market. In the first quarter of 2026, average Central Business District (CBD) Grade A office rents rose by 0.6% quarter-on-quarter to S$10.02 per square foot, marking the highest level since the pre-pandemic period of 2019.
The demand for premium office space remains robust, with Grade AAA office rents increasing by 0.4% quarter-on-quarter to S$13.28 per square foot in Q1 2026. However, the growth momentum in this segment is beginning to moderate as rents approach cyclical highs. Vacancy rates in the CBD office market have also tightened, with the vacancy rate for Grade A offices dipping by 0.1 percentage point to 6.6%, the lowest since Q3 2024.
Alan Cheong, Executive Director of Research & Consultancy at Savills Singapore, noted, “With limited new supply and persistently low vacancy levels, landlords are well positioned to maintain pricing power.” He added that whilst geopolitical uncertainties and rising energy costs could introduce volatility, structural supply constraints are expected to drive rental performance in the near term.
The market’s resilience is further supported by stable income streams and improving investor sentiment amid a lower interest-rate environment. Despite geopolitical tensions, the office market continues to demonstrate strength, with landlords benefiting from strong holding power and the ability to increase rents.
