It's currently their widest discount since 1994.
According to CIMB, the ongoing shift towards higher value-added and land-efficient activities will inevitably move Singapore towards a knowledge-based economy.
As the level of education among Singaporeans rises, the number of Singaporeans in PMET jobs could rise by nearly 50% to about 1.25m in 2030, vs. 850k today, according
to projections by the White Paper.
Two-thirds of Singaporeans will hold professional, managerial, executive and technical (PMET) jobs then, compared to about half today. To tap on this skilled workforce, the government sees an opportunity to capture growing demand for professional services in Asia.
Here's more from CIMB:
For instance, it has started awarding qualifying full bank (QFB) licence to eligible Chinese banks and liberalising the legal sector to promote Singapore as a financial and legal hub.
All these will inevitably drive demand for office space. To meet these needs, the government plans to add more office supply in centralised Marina Bay (another 1m sq m of office space, up from the current 6m sq m) and decentralised areas like Jurong Lake (500k sq m of office space), One-North and Paya Lebar Central.
The expected increase in PMET jobs will drive demand for office space and, in turn. provide support for the office market and rents. Grade A rents are currently at their widest discount to office rents in Hong Kong (~40% cheaper) since 1994 and just 15-20% above trough during the last crisis, suggesting upside for rents over the longer term.
Increased supply for office sites could provide development/acquisition opportunities for office developments/landlords.
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