Singapore Office Market Demonstrates Resilience with Fifth Consecutive Quarter of Rental Growth

Core CBD Grade A rents rise 0.8% q-o-q to S$12.40 psf/month in Q1 2026. Vacancy shrinks to record low of 3.3%. Growth expected to persist in spite of global headwinds.

March 30, 2026 -- The Singapore office market has sustained its positive momentum entering 2026 as Core CBD (Grade A) rents rose for the fifth consecutive quarter, CBRE Research has reported. This is attributed to firm occupier demand, coupled with tightening supply, and the trend is expected to continue even against a backdrop of mounting external macroeconomic and geopolitical uncertainties.

The leading global commercial real estate services and investment firm found that in Q1 2026, rents for these most highly-sought-after Core CBD Grade A office spaces increased 0.8% quarter-on-quarter to S$12.40 per square foot per month. This relentless growth comes on the back of a solid 2.9% increase through 2026, and CBRE expects this trajectory to persist into the rest of the year.

Tricia Song, CBRE Head of Research, Singapore and Southeast Asia, elaborated, “This rental resilience is the result of a combination of firm occupier demand, as well as the continued compression of vacancy rates. Presently, vacancy has shrunk to a record low of 3.3%, sharply down from 4.5% just three months before.”

Continued Flight to Quality Driving Absorption

Net take-up for these prime office spaces total approximately 200,000 square feet, primarily in buildings reflecting occupiers’ continued preference for buildings that are well-located, offering premium specifications, and boasting sustainability and wellness credentials. Examples of these buildings seeing significant intakes this quarter included IOI Central Boulevard Towers, Marina One, and MBFC Tower 1.

David McKellar, Head of Office Services and Head of Leasing, Singapore, shared his observations, “We have seen demand supported by a diverse mix of sectors, suggesting a wide and sustainable base of support. For example, we have seen active leasing from commercial banking, wealth management, and insurance – leaning into Singapore’s stable and business-friendly environment. In addition, artificial intelligence businesses, predominantly international firms, are graduating from flexible co-working arrangements and committing to dedicated, self-managed office spaces. This suggests the maturation of these businesses in Singapore, and their desire and readiness for operational certainty, brand presence, and space customisation.”

“Coworking operators also remained active in the leasing market, continuing to expand backed by robust underlying demand from their own occupier base. These end-users include start-ups, project teams, and international companies looking to create a Singapore foothold. Together, these reflect an enduring and broad confidence in the Singapore office market and economy”, he added.

Vacancies at All-time Low Across the Island

The reduction in vacancy was similarly observed beyond the CBD. Islandwide office vacancy declined by almost 10% in the quarter to 5.1%, with the tightening recorded across the board, including in the Fringe CBD and Decentralised locations.

Looking ahead, large contiguous floor plates exceeding 20,000 square feet are expected to remain scarce especially in the Core CBD. Shaw Towers stands as the only major office completion scheduled for 2026.

“This critical scarcity of available options is driving occupiers to act with urgency. We have even begun to register pre-commitment activity for developments slated for completion all the way in 2029, underscoring this acute need by tenants to secure quality space for the medium term”, Mr McKellar commented.

CBRE Outlook: Cautious Optimism

While global uncertainty and ongoing geopolitical tensions have dominated headlines in recent weeks, the Singapore office market continues to demonstrate resilience. CBRE has yet to observe material signs of occupier space rationalisation at this stage, even if this represents an area to closely monitor going forward.

Mr McKellar shared his outlook, saying, “With limited new Grade A supply entering the Core CBD over the near term, landlords of high-quality buildings are operating in a distinctly landlord-favourable environment. This imbalance between demand and supply is likely to keep rents well-supported throughout 2026.”

Ms Song added, “Singapore has navigated such cycles before. For example, in the high-inflation environment of 2022, some occupiers opted to renew leases and remain in place rather than commit to new space. A similar pattern could possibly emerge if the uncertainty globally persists and the low turnover contributes to the limited vacancy, strengthening the landlords’ negotiating position.”

“Combined with these other factors like the ongoing flight-to-quality, we maintain our forecast of about 5% y-o-y rental growth for Core CBD Grade A offices by the end of 2026. We are cautiously confident that while the volatile external environment may moderate growth, the strong demand and shortage of supply will likely outweigh the risks,” she concluded.

About CBRE Group, Inc.

CBRE Group, Inc. (NYSE:CBRE), a Fortune 500 and S&P 500 company headquartered in Dallas, is the world’s largest commercial real estate services and investment firm (based on 2024 revenue). The company has more than 140,000 employees (including Turner & Townsend employees) serving clients in more than 100 countries. CBRE serves clients through four business segments: Advisory (leasing, sales, debt origination, mortgage servicing, valuations); Building Operations & Experience (facilities management, property management, flex space & experience, digital infrastructure services); Project Management (program management, project management, cost consulting); Real Estate Investments (investment management, development). Please visit our website at www.cbre.com.

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