Singapore ranks 6th globally and 1st in APAC for architecture and engineering talent, underpinning long-term office demand. However, rising occupancy costs and hybrid working patterns are pushing firms to use space more efficiently, with implications for investors across the Grade A and secondary office segments.
TL;DR: Singapore ranks 6th globally and 1st in Asia-Pacific for attracting architecture and engineering talent, reinforcing its status as a premier office market destination. However, with Grade A office rents holding firm and occupancy costs rising, real estate advisors are urging occupiers to deploy space more strategically rather than simply expanding their footprints.
Singapore Tops APAC for Architecture and Engineering Talent — What Does This Mean for Office Demand?
Singapore has ranked 6th globally and 1st across Asia-Pacific in Savills' latest index tracking the concentration and quality of architecture and engineering (AE) talent — a metric increasingly used by multinational corporations to evaluate where to anchor their regional headquarters and technical operations. The city-state's top APAC position places it ahead of major competing markets including Tokyo, Sydney, and Hong Kong, all of which have been actively courting high-value professional services firms. This talent ranking directly influences commercial real estate demand, as firms in engineering, design, and built-environment sectors tend to require specialised, high-specification office and R&D spaces that command premium rents.
According to Savills, cities that score highly on AE talent indices tend to attract sustained long-term office occupancy from multinational tenants, reducing vacancy volatility and supporting landlord pricing power. Singapore's performance on this measure reflects years of deliberate investment in technical education pipelines, immigration frameworks that facilitate skilled worker inflows, and urban planning policies that have clustered professional services firms in districts such as the Central Business District and one-north. For commercial property investors, this structural talent advantage translates into a more resilient occupier base compared with markets where demand is driven predominantly by financial services alone.
- Singapore Global AE Talent Rank: 6th
- Singapore APAC AE Talent Rank: 1st
- Grade A CBD Office Rent (Q1 2025 est.): S$11.00–S$12.50 PSF/month
- CBD Grade A Occupancy Rate: approximately 94–95%
- Office Rental Growth YoY: +2.0% to +3.5% (Grade A, CBD)
Market Context: Rising Occupancy Costs Are Reshaping How Firms Use Space
Despite Singapore's talent-driven demand story, the commercial property market is entering a phase where cost discipline is becoming as important as location prestige. Grade A CBD rents have held firm through 2024 and into 2025, supported by limited new supply and strong pre-commitment rates at upcoming developments. This supply constraint, combined with inflationary pressures on fit-out costs and facilities management, has pushed total occupancy costs to levels that are prompting even well-capitalised tenants to scrutinise their space utilisation ratios more carefully than at any point in the post-pandemic period.
Savills and other major advisors have flagged that while headline demand remains healthy — particularly from technology, professional services, and government-linked entities — the era of firms taking on large buffer space as a strategic reserve is effectively over. Hybrid working patterns, now largely stabilised at three to four days per week in Singapore's white-collar sector, mean that peak occupancy rarely exceeds 70–75% of total leased area on any given day. Landlords are responding by offering more flexible lease structures, including shorter initial terms with renewal options, to retain tenants who might otherwise right-size into smaller footprints.
What This Means for Office Property Investors in Asia-Pacific
For institutional investors and REITs with Singapore office exposure, the talent ranking data provides a useful long-term demand anchor. Markets that consistently attract high-quality professional talent are less susceptible to sudden occupier flight, and Singapore's AE talent lead over other APAC cities suggests that demand from built-environment, infrastructure, and engineering firms will remain structurally supported — particularly given the volume of large-scale infrastructure projects across Southeast Asia that are being coordinated from Singapore-based regional hubs.
However, investors should not interpret strong talent metrics as a reason to overlook the operational shifts underway at the occupier level. Firms are being urged by their own finance functions — and by advisors including Savills — to adopt more deliberate space planning, including activity-based working models, desk-sharing ratios above 0.8, and the consolidation of satellite offices into single, higher-quality CBD locations. This trend supports demand for best-in-class Grade A and Premium Grade assets while creating headwinds for older, less efficient stock in fringe locations. Investors holding secondary office assets in markets like Singapore should monitor re-leasing spreads closely, as the bifurcation between prime and non-prime office performance is expected to widen through 2025 and 2026.
Frequently Asked Questions
Why does Singapore's architecture and engineering talent ranking matter for office property investors?
Cities with deep AE talent pools attract multinational firms that require long-term, specialised office and technical space. This creates a more stable and diversified occupier base, which reduces vacancy risk and supports rental growth — both critical factors for commercial property investment returns.
What are current Grade A office rents in Singapore's CBD?
As of early 2025, Grade A CBD office rents in Singapore are estimated in the range of S$11.00 to S$12.50 per square foot per month, with occupancy rates holding at approximately 94–95%. Year-on-year rental growth is tracking between 2.0% and 3.5% for prime assets.
How is hybrid working affecting office space demand in Singapore?
Hybrid working has stabilised at roughly three to four office days per week across Singapore's professional services sector. Peak daily occupancy rarely exceeds 70–75% of leased area, prompting firms to reduce buffer space and adopt desk-sharing models, which in turn is moderating net new demand even as headline vacancy remains low.
Which office assets are most at risk from changing occupier behaviour?
Secondary and older office stock in fringe CBD or decentralised locations faces the greatest re-leasing risk. Occupiers consolidating into fewer, higher-quality premises are gravitating toward Premium Grade and Grade A buildings with strong sustainability credentials, efficient floor plates, and superior amenities — widening the performance gap with older assets.
Is Singapore's office market still attractive for long-term investment compared to other APAC cities?
Singapore's combination of top-tier talent rankings, political stability, transparent legal frameworks, and constrained CBD supply continues to make it one of the most defensible office investment markets in Asia-Pacific. While short-term rental growth may moderate, the structural demand drivers — particularly from professional services and regional headquarters functions — remain intact relative to competing markets such as Hong Kong or secondary Australian CBDs.
