Flight-to-quality polarising Grade A office vacancy
The impact from the pandemic on office leasing has subsided, resulting in a positive office net absorption in Q3 2022. Occupiers’ demand for flight-to-quality is continuously observed, weighing on rent and vacancy for offices that fall behind in building quality.
Key highlights
- A net take-up of 577,000 sq. ft. was recorded in Q3, the highest volume since Q2 2019
- Grade A office vacancy lifted to 12.6% in Q3 2022 due to influx of new supply
- Overall Grade A office rent declined by 1.5% QoQ with cost optimisation remaining as focus for inter-district relocation
- A projected pipeline of 3.3 million sq. ft. of new Grade A office supply is expected in 2023
