Singapore’s office leasing activity surged 12-fold in the first six months of the year, topping the Asia-Pacific region, while Hong Kong leasing remained subdued amid a stubborn supply glut, according to a report by Colliers.
Tenants relocating to newly completed premium spaces drove the spike in demand in Singapore, the report said.
The city state, widely deemed Southeast Asia’s top finance hub, also saw rents improve by 1.3 per cent to S$12.10 (US$9.42) per square foot per month as of the second quarter, according to a separate report by CBRE.
“Singapore’s office demand was spurred by companies attracted to its macroeconomic stability, geopolitical neutrality and suitability as a regional business hub,” said Mike Davis, managing director for occupier services at Colliers Asia-Pacific. “There was also a spate of relocations due to a flight to quality.”
With the supply of high-end office space in Singapore’s central business district set to remain tight in the next two years, Davis said growth in prime office rents was likely to accelerate.
Overall, leasing activity across 11 key markets tracked by Colliers in Asia-Pacific rose 9.6 per cent to 4.5 million square metres (48.4 million sq ft) in the first half from a year earlier, the report said.
Besides Singapore, the Philippines and Japan also supported the regional growth, with leasing demand growing by 56 per cent and 55 per cent, respectively, the consultancy said.
In absolute terms, India, mainland China and Japan accounted for more than 90 per cent of total office demand, pushing the region’s leasing volumes higher, it added.
“Across Asia-Pacific, we’re witnessing a pivotal shift in how occupiers engage with office space,” said Davis. “The resurgence in demand – led by dynamic markets like Singapore, the Philippines and Japan – signals not just recovery but reinvention.
“As flexibility and sustainability priorities take centre stage, organisations are gravitating towards prime grade A assets that reflect their values and future ambitions. This flight to quality is reshaping the region’s office landscape, and we expect this momentum to build through the second half of 2025 and beyond.”
Hong Kong, South Korea and Taiwan recorded “relatively subdued” demand, the report said, while not providing specific figures.
Hong Kong prime office rents were projected to decline by 10 per cent this year as vacancy rates climbed to about 19 per cent “with limited appetite for expansion”, Colliers said. As of the first half, 17.3 per cent of the city’s office space was empty.
“This ongoing imbalance will prompt landlords to enhance the competitiveness of their rental offerings,” the report said.
Average office rents in Hong Kong were estimated at US$73.90 per square metre per month, about a third lower than the average office rents in Singapore at US$97 per square metre per month, the report said.
