Commentary on URA Q4 and FY 2025 statistics - Office, Retail, and Residential

By Tricia Song (宋明蔚), Head of Research, Singapore and Southeast Asia, CBRE

Office

The Singapore office market demonstrated resilience in 2025 despite external macroeconomic and geopolitical headwinds, supported by firm occupier demand and a tightening supply pipeline. Singapore’s office rents in the Central Region recorded a modest recovery in Q4 2025, marking a turnaround after two consecutive quarters of marginal contraction. 

The URA Office Rental Index for the Central Region rose by 0.4% q-o-q in Q4 2025, reversing a 0.1% q-o-q decline in Q3 2025 and 0.3% q-o-q fall in Q2 2025. For the whole of 2025, office rents edged up by 0.3%, following a flat performance in 2024.

The recovery was also echoed by market indicators tracked by CBRE Research. Core CBD (Grade A) rents increased by 0.8% q-o-q to $12.30 psf/mth in Q4 2025. For the full year, rents rose by 2.9%, outperforming the modest 0.4% increase recorded in 2024. Market conditions were further supported by a low vacancy environment. Core CBD Grade A vacancy rates declined steadily over the year, falling from 5.9% in Q1 2025 to 4.5% by year end, reflecting sustained demand for prime office space.

Notably, vacancy in the Marina Bay submarket declined steadily from a peak of 9.4% in Q3 2024—following the introduction of IOI Central Boulevard Towers—to a new low of 4.2% in Q4 2025. Both IOI Central Boulevard Towers and Marina One reached approximately 95% occupancy by year end, providing an encouraging indicator of occupier demand for prime office space in Core CBD.

Demand was supported by a continued flight to quality, as occupiers sought premium, well located, and ESG compliant premises during relocations, with some securing additional space for future needs. Singapore’s stable, business friendly environment also helped draw corporate occupiers, despite broader global uncertainties. CBRE observed active demand in 2025 came from insurance and asset management firms, financial software and cryptocurrency related tech companies, as well as coworking operators.

The supply demand balance in Singapore’s office market tightened further in Q4 2025. According to URA data, no new office space entered the market during the quarter, while net supply declined by 0.08 mil. sq. ft. As a result, net absorption was flat. Islandwide vacancy rates nevertheless trended lower, falling from 11.7% in Q1 2025 to 11.1% by Q4 2025.

Office prices in the Central Region continued to soften in Q4 2025, with URA data showing a 0.7% q-o-q decline, compared with a 0.2% fall in Q3 2025. As a result, prices fell cumulatively by 2.1% over the year. Looking forward, a lower domestic interest rate environment could lend support to investment demand over the near term as Singapore’s prime office assets are now offering positive carry, in addition to the positive rental outlook.

Outlook

The office market could become increasingly landlord favourable in 2026, supported by steady demand and limited new supply. Demand drivers include financial services, technology, asset management, and emerging AI focused firms. Large contiguous floor plates will remain scarce, with Shaw Towers standing as the only major completion in 2026. Amidst ongoing flight to quality trend and tight CBD Grade A availability, rental growth is projected to reach around 5% y-o-y in 2026.

Retail

Retail indicators such as the retail sales index continued to grow in Oct and Nov 2025, recording y-o-y increases of 0.7% and 3.6% respectively, following a 2.2% y o y expansion in Q3 2025. Consumer sentiment showed further improvement, supported by stronger than expected GDP growth and a resilient labour market. The recovery in tourism also remained on track, with visitor arrivals rising by 4.9% in Oct and 4.8% in Nov 2025 y o y, bolstered by the F1 race coinciding with China’s Golden Week holiday.

URA’s Q4 2025 data showed that rents of retail space in the Central Region increased by 0.6% q-o-q, bringing full-year growth to 1.9%. Similarly, CBRE Research’s data showed that islandwide prime floor rents increased by 0.5% q-o-q in Q4 2025, lifting full year growth to 2.4% and marking the first time islandwide average prime rents have surpassed pre COVID 19 (2019) levels.

While the retail scene continued to be inundated with news of store closures (including Twelve Cupcakes, Wan Yang Health Products and Foot Reflexology and Art Works Gallery), leasing activity remained healthy in Q4 2025. According to URA data, the quarter saw positive net absorption of 34,000 sq. m. (about 366,000 sq. ft.) in the islandwide private retail market, extending the positive net absorption in Q3 2025. Consequently, islandwide private retail vacancy rates fell from 7.2% in Q3 2025 to 6.4% in Q4 2025.
This brings the full year net absorption of 9,000 sq. m. (about 97,000 sq. ft.) versus new supply of 30,000 sq.m. (about 323,000 sq.ft). Private retail vacancy rate increased from 6.0% in Q4 2024, a decade low, to 6.4% in Q4 2025, reflecting still an overall tight market.

• Similar to the previous quarter, CBRE Research noted expansion across a broad range of sectors, with demand led by F&B such as Chick-fil-A, Coach Restaurant, and Butter & Cream. Growth was also evident among beauty & health as well as lifestyle brands including Panpuri, Jungsaemmool, Flying Tiger Copenhagen and Madison House. 

All submarkets saw positive net absorption except the Orchard area in Q4 2025. The outside central region (OCR) submarket led overall performance, recording the highest net absorption of 19,000 sq. m. (about 205,000 sq. ft.). Much of this momentum stemmed from the progressive tenant take up at Lentor Modern Mall, which was completed in Aug 2025. As a result, vacancy rates in the submarket tightened from 5.9% in Q3 2025 to 4.4% in the quarter.

Conversely, the Orchard submarket posted negative net absorption of 5,000 sq. m. (about 54,000 sq. ft.), likely due to tenants vacating Taste Orchard ahead of the 31 Dec 2025 deadline. This contributed to a slight increase in vacancy rates from 6.3% in Q3 2025 to 6.6% in Q4 2025.

Alongside the increase in rents, URA’s price index showed that prices for retail spaces in the central region rose by 1.7% q-o-q, reversing the decline of 0.7% q-o-q in Q3 2025. This brought full year price growth to 3.0%, accelerating from the rise of 1.0% in 2024. Investor appetite remained strong amid expectations of a tourism recovery and steady consumer spending, especially for suburban retail assets which benefit from a resilient local catchment.

Outlook

Retailers continue to face headwinds, including manpower constraints, elevated operating costs, and intense competition from e commerce. Nevertheless, the recovery in tourism—supported by a robust pipeline of MICE events and concerts—alongside resilient consumer spending, is expected to underpin demand for prime retail space. CBRE Research forecasts that, with new supply over the next 3 years below historical average, overall prime retail rents are projected to grow by 1–2% in 2026.

Residential

Private housing prices rose 0.6% q-o-q. This was slower than the initial flash estimate of 0.7% q-o-q and the 0.9% q-o-q increase in Q3 2025. Overall, prices rose 3.3% in 2025, the slowest growth pace since 2.2% in 2020.  The price increase was driven by landed properties which posted 3.4% q-o-q growth, accelerating from the 1.4% q-o-q increase in Q3 2025. On the other hand, the non-landed segment declined 0.2%, led by a 3.5% decline in CCR. For the full-year, landed prices grew 7.6% and non-landed prices rose 2.3%.

There was a good mix of new launches during the quarter across all market segments but varying price performance for each segment. Both the OCR and RCR saw prices accelerate from Q3, growing 1.0% and 0.7% q-o-q respectively. However, this performance was offset by the CCR which declined 3.5%, after increasing for four straight quarters. For the whole of 2025, CCR, RCR and OCR prices grew 1.9%, 1.6% and 3.2% respectively.

• CCR’s Q4 underperformance could have been attributed to realistic pricing at new launch Skye at Holland (666 units) which was the best performing project in the year, moving 658 units or 99% of total units over its launch weekend. Based on Realis caveats as of today (23 Jan 2026), 660 units have been sold at a median price of $2,949 psf.
• New OCR launches Faber Residence (399 units) and The Sen (347 units) set new benchmark prices in their respective districts. The former sold 363 units at a median price of $2,150 psf and while the latter moved 80 units at a median price of $2,339 psf.
• Likewise, the RCR saw major new launches Penrith (462 units) and Zyon Grand (706 units) which posted new benchmark prices in their districts. Penrith sold 448 units at a median price of $2,793 psf. Zyon Grand sold 610 units at a median price of $3,039 psf, 3.9% higher than the median price of $2,926 psf at adjacent new launch Promenade Peak.

 

Table 2: Top 10 best-selling new developer sales projects (excluding ECs) in 2025 (ranked in descending order by % of project sold in the year)

Project name	Tenure	Market segment	Units sold	Median Price ($psf)	% Of project sold as of Q4 2025*
LENTOR CENTRAL RESIDENCES	99 yrs	OCR	477	$2,214	100.0%
LYNDENWOODS	99 yrs	RCR	341	$2,464	99.4%
SKYE AT HOLLAND	99 yrs	CCR	660	$2,949	99.1%
PENRITH	99 yrs	RCR	448	$2,793	97.0%
SPRINGLEAF RESIDENCE	99 yrs	OCR	904	$2,168	96.1%
THE ORIE	99 yrs	RCR	735	$2,723	94.6%
PARKTOWN RESIDENCE	999 yrs	OCR	1,116	$2,363	93.5%
RIVER GREEN	99 yrs	CCR	482	$3,125	92.0%
FABER RESIDENCE	99 yrs	OCR	363	$2,150	91.0%
ZYON GRAND	99 yrs	RCR	610	$3,039	86.4%

Source: URA, CBRE Research *Sales status based on caveats from Realis as of 23 Jan 2026.

New home sales slowed in Q4 2025 after the strong uptick in Q3 2025 on fewer launches and the December holiday lull. 2,940 units were sold — down 10.6% q-o-q from Q3’s 3,288 units. Homebuying appetite remained strong amid low interest rates and new launches generally recorded robust take-up. There were 5 major launches in Q4 2025 compared to 8 in Q3 2025. The best-performing projects were Skye at Holland (666 units), Penrith (462 units) and Faber Residence (399 units) which posted launch weekend take-up rates of 99%, 97% and 86% respectively. 

Resale transaction volumes in Q4 2025 fell moderately by 9.1% q-o-q to 3,529 units after 3,881 units in Q3 2025. Resale transactions made up 52.7% of total transactions in Q4 2025, largely unchanged from 52.4% in Q3 2025. For the whole of 2025, 14,622 resale units were transacted, 4% higher than the 14,053 units in 2024.

Alongside healthy new sales, unsold inventory of uncompleted private residential units (excluding ECs) fell 12.7% q-o-q in Q4 2025 to 14,859 units from 17,029 units in Q3 2025. Including completed units, unsold inventory likewise decreased 12.8% from 17,209 units in Q3 2025 to 15,007 units in Q4 2025.

• Unsold inventory is significantly lower than the last peak of 37,799 units recorded in Q1 2019. At 15,007 units, this implies less than two years’ of landbank based on the 5-year annual average new home sales (2021 – 2025) of 8,766 units and 2025’s total developer sales of 10,815 units.

 

Rentals of private residential properties saw a reversal in Q4 2025 after 3 consecutive quarters of growth. URA’s islandwide rental index was down 0.5% q-o-q in Q4 2025 after rising 1.2% q-o-q in Q3 2025.

• Landed properties led the decline in Q4 2025, falling 3.0% q-o-q while non-landed property rents posted a more marginal decline of 0.1% q-o-q. This brought 2025 rental growth for landed and non-landed properties to 0.4% and 2.3% respectively.
• Among non-landed properties, performance was mixed across market segments. The OCR which outperformed last quarter underperformed in Q4 2025, posting a 2.0% q-o-q decrease after the 2.5% q-o-q increase in Q3 2025. Comparatively, RCR and CCR rents recorded increases of 0.6% and 0.7% q-o-q respectively in Q4 2025, compared to 1.8% growth and a 0.5% q-o-q decline last quarter. Cumulatively, 2025 rents in the CCR, RCR and OCR rose 2.5%, 2.8% and 1.3%.
• In Q4 2025, 2,018 private residential units (ex. ECs) were completed, 13.8% more than Q3 2025’s 1,776 units. At a total of 6,123 units for the whole of 2025, this was 28% lower than 2024’s completions of 8,460 units. Looking ahead, 6,083 private residential units (excl. ECs) are expected to be completed in 2026, on par with 2025 completions.
• The stock of occupied private residential units (excluding ECs) increased by 5,027 units in the quarter, compared to an increase of 2,640 units in Q3 2025. As a result, the islandwide vacancy rate of completed private residential units (excluding ECs) improved from 6.9% in Q3 2025 to 6.0%.
• Vacancy rates of completed private residential properties improved across the board in Q4 2025 at 8.8%, 6.0% and 4.9% in the CCR, RCR and OCR respectively compared to 9.9%, 6.7% and 5.6% in the previous quarter.

 

Outlook

New sales reached a 4-year high of 10,815 units amid low interest rates, pent-up demand and bumper new launches in 2025. Looking ahead, buying sentiment and appetite is expected to remain strong in 2026 amid low interest rates but sales volumes are likely to ease amid fewer launches (developers launched 11,482 units in 2025, the highest number of units since 15,885 units in 2013), the normalisation of pent-up demand and as the decline in interest rates tapers. CBRE Research expects 7,500 – 8,500 new homes to be sold in 2026.

Rents fell with the URA rental index declining 0.5% in Q4 2025 after 3 consecutive quarters of growth. With a cumulative 1.9% increase in 2025, rents have reversed the 1.9% correction in 2024 and were flat from end-2023 levels. 6,123 units were completed for the whole of 2025, 28% lower than 2024’s 8,460 units. Looking ahead, a similar number of completions is expected in 2026 at 6,083 units. While the supply situation remains conducive for landlords in 2026, it is gradually shifting in favour of tenants. Newly TOPed projects will give tenants more choices and it may take longer to rent out a vacant unit as tenants become more selective, and landlords compete to secure good tenants. Overall, we expect islandwide rents to grow 0 – 2% in 2026. 

Private home prices, which rose 3.3% in 2025 and have cumulatively risen 42.3% since the Covid trough in Q1 2020, could grow at a slower or similar pace in 2026. We forecast private home prices to grow 2 – 4%.

Read the URA press release here.