The Singapore office market continues to pursue for quality leasing services as tenants begin to seek for newer office buildings.
Over 90,000 sq ft has been leased to six tenants at the classy 20-storey office tower 20 Anson, which acquired its temporary Occupation Permit (TOP) earlier this month. Consequently, 45 percent of the 204,000 sq ft net lettable area of the building has been transacted, up from zero over the last three months.
“Given current negotiations with three other parties, we expect to be 70 percent committed in six weeks,” stated Chris Archibold, head of markets at Jones Lang LaSalle (JLL), Singapore. JLL, which represents its owner FirstOffice Pte Ltd, an affiliate of La Salle Investment Management, is 20 Anson’s marketing agent.
It is said that the neighbouring Mapletree Anson has also secured recently a tenant for its top floor. The new tenant Noble Group, which will be relocating from PSA Building, will occupy around 21,000 sq ft of the 19th floor.
Mapletree Business City (MBC) along the Alexandra Road has already secured SP Services, its most recent office tenant that has leased around 100,000 sq ft, which will move out of its present location at TripleOne Somerset (former Singapore Power Building). MBC is estimated to be completed by mid-2010.
Meanwhile, the law firm Drew & Napier is perceived to be discussing about its plan to lease 90,000 sq ft at 50 Collyer Quay located on the previous site of Overseas Union House. Drew & Napier is currently at Ocean Towers.
“Leasing activity in the office market has picked up massively in the past three months. Unfortunately, however, what we’re seeing is mostly a game of musical chairs being played as occupiers consolidate or relocate. There’s not a lot of net take-up,” said Mr. Archibold.
Angela Tan, head of occupational and development markets of DTZ, SE Asia, remarks that the surplus space called shadow office space, which was built for subletting by tenants, has been contracted.
“Occupiers are expanding, but they’re still cautious. Often when they renew an existing lease or move into a new building, they lease for their immediate needs but negotiate for first rights to rent contiguous space – whether it’s on the same floor or the floors immediately above or below – to cater for potential expansion,” she said.
Market observers notice that tenants begin to seek for quality leasing space in newer office buildings located in places like Anson Road. These buildings are designed to maximise space usage and are more efficient compared to the older buildings located in Raffles Place.