Office property market on the road to recovery: Colliers
SINGAPORE: The recovery in Singapore's office property market gained a firmer footing in the second quarter of 2014, according to Colliers International's latest Research and Forecast Report.
As growth momentum in the global and local economy picks up, brighter business prospects sparked more leasing demand for office developments, the report said.
All Grade A office micro-markets breached the technical full occupancy rate of 95 per cent by the end of June 2014, with the Shenton Way/Tanjong Pagar micro-market recording a high of 99.4 per cent.
The monthly rent of Premium Grade office space in the Raffles Place/New Downtown micro-market reached a two-and-a-half-year high of S$11.00 per square feet as of June 2014 due to the overall tightening of office occupancy islandwide.
The office property market is expected to continue to strengthen for the rest of 2014.
In the retail arena, rents remained broadly unchanged due to a lack of gathering traction in retail spending and resistance from tenants against further increases in rents, the report said.
Leasing activity, however, stayed active amid new openings in the second quarter of 2014.
A lack of momentum in tourism is another factor.
Despite this, modest economic growth and visitor arrival improvement in the next half of the year will lend strength to the retail sector, the report said.
However, the retail trading environment remains challenging due to increasing competition and rising cost.
Retail rents are not expected to change substantially for the rest of the year, with general occupancy levels expected to be fairly stable.