Both absorption and rent are still in a downward trend, and the situation is expected to continue up to the end of 2020. Tenants who are already in a good position will continue to be active in rental negotiations and demands for incentives such as free parking and opportunity to lock-in space occupied in long-term leases, especially for office buildings attached to an MRT station. At the same time, landlords are currently in a position to avoid complicated negotiations in lease agreements, avoiding potential tenants moving to other buildings.
The current outbreak will create further opportunities for office occupiers to test the feasibility and may encourage companies to be more willing to accelerate the adoption of flexible and home working policies in the future. We suggest that landlords prioritise filling their vacancies because this will create more room to adjust rent in line with rising occupancy.