Singapore's prime office rents to slide further this year

Rents went down by 1.5%.

A combination of softer external demand and tightening global financial conditions continues to dampen Singapore's office market, with rents going down 1.5% in the past quarter.

According to a report from Knight Frank, Singapore, along with Kuala Lumpur and Jakarta, had a different fate compared to regional peers which registered spike in rents for the past quarter. Bangkok has the strongest-performing office market, reflecting a 5% growth. Office rents in Phnom Penh and Hong Kong also registered increases at 1.6% and 2.8%, respectively. Overall, prime office rental index in the region grew 1.3%.

The report noted that office rents in Singapore, Kuala Lumpur, and Jakarta are set to decrease further in the next 12 months.

"Large incoming pipelines in all three cities in 2017 and subdued demand will likely exert further downward pressure on rental and occupancy levels," the report said.