Given that the commercial rental market in Singapore is currently slow, should I wait for supply and demand conditions to cause prices to drop further before making a decision?

The current commercial rental market in Singapore is experiencing subdued demand and generally stable to slightly rising rents, depending on sector and location. In the office sector, CBD office rents have edged upwards in the second quarter of 2025, primarily supported by tenants renewing leases and a continued “flight to quality” as companies look for better-grade spaces. However, demand overall has been more cautious, with some firms holding back expansion plans due to macroeconomic uncertainties.

Retail rents fell slightly by 0.5% in the first quarter of 2025, and occupancy has also dipped, pointing to a more tenant-friendly environment in this segment at present. Similarly, the industrial sector has seen a revised, lower rental growth forecast of between 0% and 2% for 2025, suggesting limited upside there as well.

Supply is expected to remain relatively limited for higher-grade spaces in core locations over the next few quarters, which supports prices for these segments. In other sectors, particularly retail and certain parts of industrial, supply pressures and cooling demand may cap further rental growth.

If you are considering whether to wait before committing to a commercial lease, much will depend on your specific needs and the segment you are targeting:
- For Grade A office space in prime locations, upward pressure on rents may persist due to limited new supply.
- For retail and standard industrial properties, there could be more room for negotiation, and mild rental declines may continue if current trends hold.

Overall, the market is not expected to see significant rental drops in the immediate future, but aggressive rental hikes are also unlikely. If waiting fits your business timeline and you are eyeing retail or non-prime spaces, you may see marginally better terms. However, for prime offices, waiting may not yield significant savings and may risk losing preferred spaces. It is advisable to monitor specific submarket trends closely and leverage available data and tools on EdgeProp Singapore to make an informed decision.