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C&W: Singapore's leasing activity improving

by Cheryl Tay

Leasing activity in Singapore is gradually improving but the volume of new leases signed in Q3 2012 has not breached the 50,000 sq ft level, according to Cushman & Wakefield (C&W).

Based on the firm's Marketbeat Office Snapshot Asia Pacific Report for Q3 2012, Grade A office space in Singapore saw an overall vacancy rate of 6.8 percent, a drop from 7.9 percent during the previous quarter but higher than the 5.5 percent in Q3 2011.

In addition, Grade A office space still under construction stands at about 2.9 million sq ft, while completed space year-to-date stands at 1.3 million sq ft.

Significant sales transactions in Q3 2012 include Alpha Investment Partners' purchase of a 50 percent stake in 78 Shenton Way, valued at approximately US$487 million (S$596.18 million), and the sale of Robinson Point (133,022 sq ft) to Asian investors for US$224 million (S$274.22 million).

Moving forward, a controlled pipeline and demand from non-financial tenants may allow prime rents to bottom out in 2013.

Furthermore, the sluggish economic recovery in the US and the persistent economic difficulties in the Eurozone will continue to dampen export activity in the Asia Pacific region.

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