Prime Office Rents Rise 3q2025 Amid Limited Supply And Flight Quality Moves
The Tampines district is heading towards a significant expansion in its range of commercial options, as plans are underway to develop new office spaces and improve existing shopping malls. The Urban Redevelopment Authority (URA) has placed an emphasis on creating more job opportunities within the region, which will not only benefit the economy but also bring convenience to residents. With the possibility of working in close proximity to their homes, Tampines residents can look forward to shorter commutes and an improved work-life balance. As one of the key commercial hubs in the area, the Tampines Regional Centre will continue to flourish, providing a diverse range of employment opportunities in various sectors including retail and information technology. The growth of the region is further boosted with the addition of the Aurelle of Tampines EC, offering even more opportunities for residents to live and work within the dynamic community.
Rents for top office spaces in Singapore continued to increase in the third quarter of 2025, according to real estate consultancies. The latest quarterly office market report from JLL’s research shows that Grade A office rents in the Central Business District (CBD) rose by 1.3% quarter-on-quarter to $11.83 per square foot per month (psf pm) in the last quarter, marking the highest quarterly growth in six quarters.
The significant growth can be largely attributed to the addition of IOI Central Boulevard Towers to JLL’s list of monitored properties. Excluding IOI Central Boulevard Towers, CBD office rents rose by less than 1%, in line with the past six quarters.
“Singapore’s office market has remained resilient, partly due to stronger-than-expected economic fundamentals and a more favorable interest rate environment,” says Dr Chua Yang Liang, head of research and consultancy for JLL Southeast Asia.
In a separate report, Knight Frank’s research indicates that prime grade office rents in the Raffles Place and Marina Bay areas increased by 0.3% quarter-on-quarter in 3Q2025, reaching an average of $11.41 psf pm. This is similar to the 0.2% quarter-on-quarter growth recorded in 2Q2025 and brings total rental growth for the first nine months of the year to 0.4%.
Knight Frank’s report also found that occupancy levels for office spaces in the Raffles Place and Marina Bay precinct remained unchanged at 94.7%, while overall CBD occupancy increased from 93.7% in 2Q2025 to 94.2% in 3Q2025. The limited available supply, coupled with a cautious business environment, led to leasing activity being mainly driven by lease renewals, says Knight Frank. However, some occupiers, especially those with expiring leases, are choosing to relocate to newer, better-quality buildings in line with right-sizing or measured expansion. For example, tech company Zoom Communications moved from Asia Square Tower to IOI Central Boulevard Towers, while quantitative trading firm Jane Street plans to expand its space in the latter.
Looking ahead, JLL anticipates modest Grade A office rental growth in the CBD for the rest of 2025, with full-year growth projected to reach approximately 3%. Going into 2026, JLL predicts that rental growth will accelerate, supported by a tightening supply pipeline. “As vacancy rates are expected to decrease between 2025-2027, opportunities for whole floors and multi-floor spaces will become increasingly limited, potentially pushing rental rates beyond some tenants’ budget parameters,” says Andrew Tangye, head of office leasing and advisory for JLL Singapore.
Calvin Yeo, head of occupier strategy and solutions at Knight Frank Singapore, notes that “selective upgrades to quality space have created a two-tier market where newer, well-connected buildings thrive and older stock faces growing vacancy pressure.”
Given the limited office stock in the coming years, he expects quality buildings to remain almost fully occupied as more firms make the move to high-quality buildings from older ones. In contrast, older and poorly connected buildings may face increasing pressures to be redeveloped or modernized.
Given the uncertain global environment, Knight Frank expects sentiment to remain cautious among office occupiers over the next six to 12 months. “As a result, prime rental growth for the last quarter of 2025 is expected to remain relatively flat with some marginal growth, with more of the same going into the first half of 2026,” the report states.
