Knight Frank chart for Prime Office Rents as Second Quarter of Growth in 4Q2021

Read more: Banyan Tree Group debuts new brand concept in Phuket, Thailand

The prime-quality office rental rates within the Raffles Placeand Marina Bay precinct recorded a second consecutive quarter of modest rise in 4Q2021, as per an analysis report from Knight Frank.

Prime office rents increased 1.5% q-o-q to $10.13 per month. This is following an increase of 0.2% increase last quarter. The total decrease for prime office rentals for 2021 was just 0.3%, compared to the drop by 10.2% in 2020. In the 4Q2021 quarter, occupancy levels within Raffles Place and Marina Bay Raffles Place/ Marina Bay precinct decreased in the Marina Bay precinct by 1.8 percent, mostly due to the closing of CapitaSpring.

But, Knight Frank notes that despite the general decrease in office usage due to the flexibility of workplace requirements and other factors, overall CBD occupancy was steady at over 90%.

“The office reconfiguration so that less space is utilized more efficiently by a larger number of employees continues to fuel the “flight for quality” as corporations are increasingly taking up smaller spaces before rents begin to climb significantly,” the report reads.

Knight Frank highlights that more executives are now being pressured to design a pleasant and flexible workplace that draws and keeps the best talent. In this regard as the market for office spaces changes with the advent of hybrid working, bringing it from the fringes to standard, Knight Frank anticipates the size of the space needed by businesses will be dramatically altered.

In the study, businesses are advised to be discerning in finding the ideal balance in working from home and hybrid arrangements even after the government has stopped mandating work-from-home. Based on a survey conducted of EY for 2021 Knight Frank notes that 54% of respondents said they might consider quitting their jobs once the pandemic has gone away in the event that some type of flexible working is not available.

Additionally, Knight Frank points out that occupiers who are operating with short-term ventures are increasingly incorporating coworking spaces in a hybrid and distributed workplace strategy, gaining flexibility in leasing obligations. For instance, the DataStax, a data management company DataStax is a recent example, having established a Regional headquarters in Singapore and has leased space in WeWork in the Suntec Tower 5. Suntec Tower 5.

In the future, Knight Frank maintains a prediction that ranges from 3% or 5% in rent increases throughout 2022 and 2022, based on the limited availability of office supplies and a more robust economy.