Rents rose faster in Q4

SINGAPORE - High rentals continued to dog many businesses in the last quarter, with office rents rising at a faster pace in the fourth quarter, said real estate consultant DTZ Research said.

Average prime gross rents in Raffles Place rose 7.1 per cent on quarter to $9 per sq ft per month, from a 6.3-per-cent rise in the previous quarter. For the whole of this year, average prime gross rents in Raffles Place have increased by 13.9 per cent, DTZ said.

Park Regis and Solaris were completed in the quarter, bringing the new supply for the full year to 2.4 million sq ft.

DTZ said that island-wide office occupancy rose by 0.5 percentage points on quarter and 3.7 percentage points on year to 95.4 per cent. The net absorption of office space for the whole of this year was estimated at about 4.4 million sq ft, which includes about 1.7 million sq ft of pre-committed space.

Ms Chua Chor Hoon, head of DTZ South-east Asia Research, said that while there would be a substantial amount of new completions next year, it would be mitigated by the removal of an estimated 0.8 million sq ft of existing buildings for redevelopment.

"We project rents to move up at a slower rate next year until there are clearer signs of a recovery in the US and Europe, as this is still holding back widespread expansion, particularly among occupiers whose headquarters are based in these major economic regions," she said. Travis Teo

by Travis Teo
05:55 AM Dec 30, 2010

Source: www.todayonline.com