With economic recovery gaining traction, preliminary real estate investment volume in Singapore increased by 11.5% q-o-q, to $3.523 bn for Q1 2021.
Supported by the tight vacancy, the rental decline in the Grade A (Core CBD) market was arrested after four quarters of correction. Conversely, the Grade B market continued to grapple with higher vacancy rates and rents registered a further decline.
The performance of the business park market softened slightly in Q1 2021. Negative net absorption was noted, contributed by the City Fringe submarket.
There has been a slowdown in rental declines of prime retail spaces. Landlords continue to maintain a flexible stance towards rental expectations.
The strong performance in the residential market has further shored up homebuyers’ confidence and take-up of new launches.
Leasing activity was stable in Q1 2021, albeit slowing down from the strong performance of the previous quarter. Transactions consisted mainly of renewals and relocations, along with a handful of new set ups and expansions.