Decentralised office rents fall as firms relocate to CBD: JLL
The redevelopment of 79 Anson Road, which could start next year, is expected to compound supply restrictions further, he adds.
As relocations carry on to support demand, workplace leas in the CBD are anticipated to remain moderate, with JLL predicting full-year growth of 2% this year. Nevertheless, rental fees might pick up in 2025, amidst minimal supply. “No huge office completions are anticipated for the next 12 months, with the brand-new Shaw Tower only entering onstream in 2H2026,” notes Chua.
Despite recurring 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 per month, marking a fifth straight quarter of sub-1% growth, according to JLL.
In contrast, workplace leas in the decentralised sub-market recorded a downtrend in 2Q2025, its first fall in four years. Rental fees in the market slipped 0.8% q-o-q to $7.61 psf monthly last quarter. “This decrease is attributed to recurring rightsizing efforts and renters relocating to, or closer to, the CBD, stimulated by the enhanced availability of space,” JLL adds.
A lot more firms may be forced to relocate to the CBD because of “the current lack of a substantial rent space between CBD and decentralised workplaces”, says Dr Chua Yang Liang, JLL’s head of study and consultancy for Southeast Asia. Currently, the average lease space in between investment-grade workplaces in the CBD and the decentralised sub-market stands at around 30% to 35%, which Chua claims is lower the historical 50% to 60% rank.
Meanwhile, Tangye thinks property managers with vacant space are concentrating on improving occupancy and stabilising portfolios ahead of 2026, when rents may start climbing once more before new supply enters the marketplace in 2028. He adds: “By implementing targeted property enhancements, consisting of modernised entrance halls and bathrooms, along with the restoration and remodelling of out-of-date office locations, property owners are positioning themselves to attract costs tenants and capitalise on the expected rental growth opportunities.”
One instance is Audi Singapore, that recently transferred its business offices from Aperia on Kallang Avenue to Funding Square in the CBD. The move coincided with the display room’s shift from Alexandra Road to 18 Cross Street, just a short stroll from Capital Square, claims Tangye.
Andrew Tangye, head of office leasing and advisory at JLL Singapore, states a growing trend of “strategic recentralisation” and “quality-driven moves” to workplaces in the CBD. “Many services in Singapore are progressing towards higher-value products and improved company models, causing a movement of some office demand from decentralised places to CBD properties that better suit their increasingly sophisticated and client-oriented operations,” he includes.
