Chart of the day: CBD rents to rise up to 9% in 2019

Islandwide occupancy rate increased from 92.4% in Q4 2018 to 93.5% in Q1.

Rental rates within the CBD are projected to rise between 5% and 9% in 2019 as the office sector is expected to remain relatively positive, largely due to limited new office supply until 2022, according to research from Edmund Tie & Company.

So far in Q1, average gross monthly rents in the CBD increased by 1.5% to 3.5% QoQ in Q1 2019. Islandwide occupancy rate increased from 92.4% in Q4 2018 to 93.5% in Q1, with occupancy rate in the CBD rising the most to 94.8%.

On the contrary, occupancy rate in the city fringe fell marginally by 0.4ppt. This was partly driven by rising vacancies of older office buildings as well as strata-owned buildings.

Office transactions (valued above $30m) also slowed in the quarter with just three transactions comprising strata offices with a total value of $247m.