The Singapore office market demonstrated resilience in Q2 2026, with renewal-led demand bolstered by limited supply in the Central Business District (CBD), according to Knight Frank Singapore. Despite geopolitical uncertainties, the city-state’s reputation as a safe-haven continues to attract interest in prime assets, with rents for prime office spaces increasing.
Rents for prime grade office spaces in the Raffles Place and Marina Bay areas rose by 1.0% quarter-on-quarter, reaching an average of S$11.69 per square foot per month. Occupancy in these areas remained stable, with a slight dip to 96.7%, whilst overall CBD occupancy increased to 95.3%.
The demand for office space is driven by external uncertainties and a lack of new supply, as the government has not released land for office development in the CBD. This has led to a preference for stability over expansion among occupiers, with relocation costs being a significant barrier. Tridiana Ong, Head of Occupier Strategy and Solutions at Knight Frank Singapore, noted that “renewals were executed more out of necessity than expansion.”
The flight-to-quality trend continues, with companies seeking well-located, newer Grade A buildings. However, older buildings without modern amenities face increased vacancy risks. Some firms, like ByteDance, are considering decentralised locations, such as Mapletree Business City, for cost-effective expansion.
AI-related firms are also expanding in Singapore, with OpenAI establishing its first overseas Applied AI Lab and Databricks planning to quadruple its office space. These developments highlight Singapore’s growing role as a regional hub for AI activities.
Looking ahead, Knight Frank expects market conditions to remain resilient, with rents projected to rise by 3% to 5% in 2026. Decentralised spaces are likely to capture spillover demand as CBD occupiers seek lower-cost options.
