Decentralised office rents fall as firms relocate to CBD: JLL
In contrast, workplace rents in the decentralised sub-market recorded a decline in 2Q2025, its very first fall in four years. Leas in the market slipped 0.8% q-o-q to $7.61 psf per month last quarter. “This decrease is credited to recurring rightsizing efforts and occupants relocating to, or closer to, the CBD, driven by the boosted availability of space,” JLL adds.
Andrew Tangye, head of office leasing and advisory at JLL Singapore, says an expanding pattern of “strategic recentralisation” and “quality-driven relocations” to workplaces in the CBD. “Many businesses in Singapore are evolving toward higher-value products and improved company models, causing a movement of some office need from decentralised places to CBD facilities that better fit their significantly sophisticated and client-oriented procedures,” he includes.
One example is Audi Singapore, which just recently moved its business from Aperia on Kallang Avenue to Capital Square in the CBD. The decision accompanied the display room’s shift from Alexandra Road to 18 Cross Street, just a brief stroll from Capital Square, claims Tangye.
The redevelopment of 79 Anson Road, which might begin following year, is expected to compound supply constraints better, he adds.
A lot more companies might be obliged to move to the CBD as a result of “the current absence of a considerable rental fee gap in between CBD and decentralised offices”, states Dr Chua Yang Liang, JLL’s head of research and consultancy for Southeast Asia. Currently, the average rent space between investment-grade offices in the CBD and the decentralised sub-market stands at around 30% to 35%, which Chua claims is lower the historic 50% to 60% range.
As relocations continue to support need, workplace leas in the CBD are expected to continue to be small, with JLL predicting full-year growth of 2% this year. Nevertheless, rental fees may pick up in 2025, in the middle of minimal supply. “No major office completions are anticipated for the next 12 months, with the new Shaw Tower only entering onstream in 2H2026,” notes Chua.
Despite recurring financial and geopolitical unpredictabilities, CBD office rents edged up again in 2Q2025. Grade A gross effective leas climbed 0.7% q-o-q to $11.69 psf per month, observing a fifth straight quarter of sub-1% growth, according to JLL.
At the same time, Tangye thinks property managers with vacant area are concentrating on increasing occupancy and securing profiles ahead of 2026, when rental fees may begin increasing once again prior to new supply goes into the market in 2028. He adds: “By executing targeted property improvements, including modernised entrance halls and bathrooms, along with the restoration and remodelling of out-of-date office locations, property owners are positioning themselves to draw in costs tenants and capitalise on the expected rental development chances.”
