Decentralised office rents fall as firms relocate to CBD: JLL
As transfers continue to support need, office leas in the CBD are expected to stay small, with JLL anticipating full-year growth of 2% this year. Nevertheless, leas may pick up in 2025, amidst minimal supply. “No huge workplace completions are anticipated for the following 12 months, with the new Shaw Tower only happening onstream in 2H2026,” notes Chua.
The redevelopment of 79 Anson Road, that can begin next year, is anticipated to compound supply restrictions further, he adds.
At the same time, Tangye thinks property managers with uninhabited space are concentrating on boosting occupancy and securing portfolios ahead of 2026, when rental fees may start increasing once again prior to new supply enters the market in 2028. He adds: “By executing targeted property enhancements, consisting of modernised entrance halls and washrooms, in addition to the repair and remodelling of obsolete workplace locations, property owners are placing themselves to attract costs tenants and capitalise on the anticipated rental growth possibilities.”
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On the other hand, workplace leas in the decentralised sub-market documented a downturn in 2Q2025, its first fall in four years. Rents in the market dropped 0.8% q-o-q to $7.61 psf per month last quarter. “This decline is credited to ongoing rightsizing efforts and renters moving to, or closer to, the CBD, driven by the increased opportunity of space,” JLL adds.
More firms might be obliged to move to the CBD because of “the present lack of a significant rent gap in between CBD and decentralised offices”, states Dr Chua Yang Liang, JLL’s head of study and consultancy for Southeast Asia. Currently, the average lease void between investment-grade offices in the CBD and the decentralised sub-market stands at around 30% to 35%, that Chua says is lesser the historical 50% to 60% tier.
Despite 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 each month, marking a fifth straight quarter of sub-1% growth, according to JLL.
Andrew Tangye, head of workplace leasing and advisory at JLL Singapore, says an increasing pattern of “strategic recentralisation” and “quality-driven relocations” to offices in the CBD. “Many establishments in Singapore are progressing towards higher-value offerings and enhanced service models, causing a migration of some workplace need from decentralised locations to CBD facilities that far better accommodate their significantly sophisticated and client-oriented procedures,” he adds.
One instance is Audi Singapore, which most recently moved its business offices from Aperia on Kallang Avenue to Resources Square in the CBD. The relocation coincided with the display room’s change from Alexandra Road to 18 Cross Street, simply a brief stroll from Capital Square, says Tangye.
