Tight supply is expected to support office rents through the year.

TL;DR: Singapore Grade A office rents are forecast to rise up to 5% in 2026, driven by constrained new supply and steady demand from financial and technology occupiers. Investors holding prime CBD assets stand to benefit from improving rental yields as vacancy tightens further.

Singapore Grade A Office Rents Forecast to Rise 5% in 2026

Singapore Grade A office rents are projected to climb by as much as 5% through 2026, underpinned by a structural supply shortfall that shows no sign of easing in the near term. Current Grade A office rents in the core CBD are hovering around S$11 to S$12 per square foot per month, and analysts expect upward pressure to persist as occupier demand from financial institutions, professional services firms, and technology companies remains resilient. The forecast marks a meaningful acceleration from the modest rental growth recorded in 2024, when rents edged up by approximately 2% to 3% across premium buildings in Raffles Place and Marina Bay.

• Forecast rent growth (2026): Up to +5.0%
• Current Grade A rents (CBD): S$11–S$12 psf/month
• 2024 rent growth (Grade A): ~+2% to +3%
• Core CBD vacancy rate: Approximately 4.5%–5.5%
• New supply pipeline (2025–2026): Below historical average

Why Supply Constraints Are the Central Driver

The primary force behind the rental growth forecast is a near-absence of significant new Grade A completions scheduled for delivery in 2025 and 2026. Unlike the supply surge seen in the early 2020s — which included major completions such as CapitaSpring and IOI Central Boulevard Towers — the current pipeline is thin, with very few large-scale projects expected to add meaningful stock to the CBD over the next 18 to 24 months. This scarcity dynamic is particularly acute in the Marina Bay financial district, where vacancy for the best-in-class floors has already compressed to single-digit levels, leaving tenants with limited alternatives when lease renewals come due.

Compounding the supply picture is the ongoing withdrawal of older, lower-specification office stock from the market as landlords pursue asset enhancement initiatives or convert buildings to alternative uses. This effectively reduces the total available pool of quality space even further, concentrating demand pressure on the remaining premium inventory. Buildings that have recently completed refurbishment programmes are reportedly commanding rental premiums of 10% to 15% above their pre-upgrade asking rents, a signal that occupiers are willing to pay for quality when options are scarce.

Demand Fundamentals Remain Intact

On the demand side, Singapore continues to attract regional headquarters mandates from multinational corporations seeking a stable, well-regulated base for Asia-Pacific operations. The financial services sector — including private banks, asset managers, and family offices — has been a consistent source of office leasing activity, particularly for floors of 5,000 to 20,000 square feet in Marina Bay and Raffles Place. Technology firms, while more cautious about footprint expansion than in 2021 and 2022, have not materially vacated their Singapore positions, and several have been quietly upsizing as headcount recovers.

Flexible workspace operators have also re-emerged as a notable source of demand, pre-committing to floors in upcoming refurbished assets to capture the overflow from tenants unable to secure direct leases. This trend adds a further layer of absorption to the market and helps landlords maintain high occupancy rates even before a building reaches full stabilisation. Net absorption in the CBD is expected to remain positive through 2026, albeit at a moderate pace rather than the elevated levels seen during the post-pandemic rebound.

What This Means for Office Investors in Singapore

For investors holding or evaluating Grade A office assets in Singapore's core CBD, the rental growth trajectory translates directly into improving income returns. Current market capitalisation rates for prime Singapore office assets are estimated in the range of 3.5% to 4.0%, and any sustained rental uplift of 4% to 5% annually would support both net operating income growth and, potentially, modest cap rate compression if institutional appetite for the asset class strengthens. Investors acquiring assets today at current pricing would be buying into a rental cycle that still has meaningful upside, particularly if the supply gap extends into 2027 as currently anticipated.

Prospective buyers should, however, price in the risk of a global economic slowdown dampening occupier expansion plans, as Singapore's office market is not immune to external shocks. Lease expiry profiles matter significantly in this environment — assets with near-term lease rollovers offer the greatest opportunity to capture mark-to-market rental gains, while those locked into long fixed-term leases at below-market rents will see a lag before the rental growth forecast flows through to income. Due diligence on weighted average lease expiry and tenant covenant quality remains essential for any acquisition decision in this cycle.

Frequently Asked Questions

What is driving Singapore Grade A office rent growth in 2026?

The primary driver is a constrained supply pipeline, with very few new Grade A completions scheduled for the CBD in 2025 and 2026. Combined with steady demand from financial services, technology, and professional services occupiers, this supply-demand imbalance is pushing rents higher, with forecasts pointing to growth of up to 5% through the year.

What are current Grade A office rents in Singapore's CBD?

Grade A office rents in Singapore's core CBD are currently in the range of S$11 to S$12 per square foot per month, with the best floors in Marina Bay and Raffles Place commanding the upper end of that range. Refurbished or newly completed buildings with premium specifications are achieving rents above S$12 psf per month in some cases.

How does the Singapore office market compare to other Asia-Pacific cities?

Singapore stands out in the Asia-Pacific office market for its relatively low vacancy, stable regulatory environment, and consistent demand from multinational occupiers. While markets such as Hong Kong and some mainland China cities are dealing with elevated vacancy and downward rental pressure, Singapore's fundamentals are more supportive of rental growth through the current cycle.

What capitalisation rates apply to prime Singapore office assets?

Prime Grade A office assets in Singapore's CBD are currently transacting at estimated capitalisation rates of approximately 3.5% to 4.0%. These yields reflect the city-state's status as a safe-haven investment destination and the scarcity of available investment-grade stock, which limits supply of assets coming to market and supports pricing.

What risks should office investors in Singapore monitor?

Key risks include a global economic slowdown that could suppress occupier expansion, potential oversupply if several large development projects are announced simultaneously, and interest rate movements that affect financing costs and cap rate expectations. Investors should also monitor lease expiry profiles carefully, as assets with long fixed-term leases at below-market rents will take longer to benefit from the current rental growth cycle.