SINGAPORE (THE BUSINESS TIMES) – Retail property rents in Singapore’s central region continued to retreat in the third quarter of this year, while those for office space fell, reversing a six-month recovery.
According to data from Urban Redevelopment Authority (URA) on Friday (Oct 22), retail rents fell by a sharper 2.7 per cent in Q3, after a 0.5 per cent dip in Q2.
Meanwhile, prices for retail space in the central region remained unchanged, following a decline of 2.8 per cent in Q2.
On an islandwide basis, as at the end of Q3, there was a total supply of 428,000 square metres (sq m) gross floor area of retail space from projects in the pipeline, up 2.1 per cent from 419,000 sq m as at end-Q2 2021.
The amount of occupied retail space expanded by 33,000 sq m net lettable area (NLA) in Q3, compared with an increase of 14,000 sq m NLA in the previous quarter. The stock of retail space increased by 7,000 sq m NLA in Q3, after a larger 18,000 sq m increase in the previous quarter.
This resulted in the islandwide vacancy rate of retail space dropping from 8.5 per cent at end-June to 8.1 per cent as at end-September.
Rents for office space in the central region fell 3.5 per cent in Q3 over the previous quarter, the URA data showed. This contrasts with the 1.3 per cent quarter-on-quarter rise in Q2.
The prices for office space in the central region also slipped, by 2.4 per cent against the increase of 0.9 per cent in the previous quarter.
Islandwide, at the end of Q3, there was a total supply of about 755,000 sq m GFA of office space in the pipeline, higher than the 697,000 sq m at the end of the previous quarter.
Net demand, as measured by the amount of occupied office space, shrank by 5,000 sq m NLA, after contracting by 23,000 sq m in the previous quarter.
On the other hand, the stock of office space rose 26,000 sq m NLA in Q3, after expanding by 34,000 sq m in the previous quarter.
As a result, the islandwide vacancy rate of office space climbed to 12.9 per cent as at end-September, from 12.6 per cent as at end-June.