Singapore’s office landlords are consolidating their negotiating advantage as CBD Grade A vacancy rates compressed to approximately 4.7% in the third quarter of 2025, down from 5.2% in the preceding quarter, a trajectory that CBRE projects will tighten further to around 4% by the end of 2026.
Singapore CBD Grade A vacancy rates dropped to 4.7% and are projected to tighten further to 4% by late 2026.
This sustained decline in available space has shifted market dynamics decisively in favour of property owners, who are now demonstrating reduced willingness to negotiate on face rents while simultaneously trimming rent-free periods and other tenant incentives.
The supply pipeline remains constrained, with Shaw Tower on Beach Road cited as the only major Grade A CBD completion expected in 2026. This scarcity of new stock is compounding pressure on tenants, particularly those seeking large contiguous floors in existing towers, where options have become increasingly limited.
Shadow space for CBD Grade A offices has fallen to slightly below pre-pandemic norms, further tightening effective availability and reinforcing upward pressure on rental rates.
Multiple consultancies have issued forecasts pointing to accelerated rental growth in 2026. CBRE expects Core CBD Grade A office rents to rise approximately 4.9%, from S$12.30 per square foot per month in the fourth quarter of 2025 to S$12.90 by the fourth quarter of 2026.
JLL projects 4–5% rental growth for its CBD Grade A basket, while Cushman & Wakefield anticipates increases of 4–7%. Knight Frank forecasts 3–5% growth for its Prime Office Rent basket, and Colliers expects a 2–4% rise for CBD Grade A and Premium space.
Landlords offering fitted-out, plug-and-play space are commanding premium rates as occupiers seek to avoid upfront capital expenditure. Flexible solutions including short-term leases are being priced at a premium reflecting their convenience and scarcity.
Property owners who have proactively accelerated backfilling of vacated space are benefiting from steady demand conditions. Properties with green certifications are commanding 3-5% higher rental premiums as occupiers increasingly prioritize sustainability credentials. The re-centralisation trend of companies relocating back to the CBD is expected to further intensify the tight supply situation in 2026.
The tight availability is driving earlier lease reviews by tenants seeking to secure space before further rent escalation. Demand is being driven primarily by new entrants from China and India, as well as companies in the technology and energy sectors.
URA data indicates office rents in the central region were broadly flat in 2024 following a 13.1% surge in the preceding twelve months, suggesting the market paused before entering this renewed growth phase.
