Singapore Grade A office vacancy up 1.6ppts to 7.2% in Q1

Despite this, net take-up of office spaces remained positive for the third consecutive quarter.

Based on the CBD Grade A offices tracked by Savills, the vacancy rate rose by 1.6 ppts QoQ to 7.2% in Q1/2022. This was attributed to the addition of CapitaSpring, a Grade AAA building, into office stock. In the previous quarter, the addition was Afro-Asia-i-Mark. 

As a result, Savills says there was a significant increase of 4.2 ppts in vacancy in CBD Grade AAA buildings from 3.3% in Q4/2021 to 7.5% in Q1/2022. Similarly, vacancy rates of Grade AA buildings rose 2.2 ppts QoQ to 7.1%. 

Here’s more from Savills:

On the other hand, vacancy rates of Grade A buildings declined from 8.5% in Q4/2021 to 7.1% in the quarter. Despite the increase in vacancy rates in Q1/2022, net take-up of CBD Grade A offices remained positive for the third consecutive quarter, albeit moderating to 59,000 sq ft, from 206,000 sq ft in the previous quarter. 

Across the various micro-markets, QoQ increases in vacancy rates were observed for Raffles Place, Shenton Way, City Hall and Beach Road/Middle Road. Out of these areas, the largest rise in the vacancy rate was in Shenton Way and this was largely due to JP Morgan relocating to the newly completed CapitaSpring. While vacancy rate of offices in Orchard Road remained unchanged in the quarter, declines in vacancy rates were registered for Marina Bay (-0.4 of a ppt) and Tanjong Pagar (-0.2 of a ppt).