When a number of Singapore banks began trimming office space towards the end of 2020, it seemed to spell doom and gloom in the office leasing market. Surprisingly, firms from other industries have been quick to pounce on these prime commercial units. Developers, institutional landlords and real estate investment trusts (Reits) realised they need not be overly concerned, and began to welcome the new mix of tenants.
At the Marina Bay Financial Centre (MBFC) Tower 1, tech firms from the US, China and Singapore are among those who have expressed “very strong interest” in roughly 200,000 sq ft across nine and a half floors. Media companies and financial services providers are also eyeing on part of the 400,000 sq ft in MBFC which is currently leased to Standard Chartered until October 2022.
Over at One Raffles Quay which is managed by Keppel Reit, at least 95% of the 200,000 ssq ft space vacated by UBS has been leased to L’Oreal (67,000 sq ft), The Executive Centre (top two floors), Canadian pension fund OMERS (19,300 sq ft), Capital International ( 58,000 sq ft) and TikTok owner ByteDance (over 60,000 sq ft). TikTok itself leased two floors amounting to 58,000 sq ft at GuocoLand’s Guoco Tower, formerly occupied by Dentsu Aegis Network.
Despite several employers’ plans to make hybrid work arrangements, it has not led to a spike in office vacancies. Co-working space operator, JustCo recently reported that the occupancy rates across its 17 centres are around 80% to 90%. The company is set to open three more centres soon, including a 35,000 sq ft space in The Metropolis Tower One.