AI to reshape, not reduce, demand for Singapore Grade A offices: C&W
In a September research record called AI Impact: Office Insights Singapore, the property services firm researched the possible effect of AI fostering on Singapore’s economic climate, labor force and industrial property with to 2030.
The variety of results shows a “durable” prime office market, with vacancy remaining below 5%, noted Dr Dominic Brown, head of international research at Cushman & Wakefield. “It shows why the effect of AI on realty can not be comprehended with jobs alone– supply, productivity, business growth and the modifying role of the workplace all matter.”
“As services reconsider just how and where their individuals work, we anticipate need to turn into extra careful, thereby placing an also higher premium on quality, connection and flexibility,” she added.
Among the 4 scenarios designed in its study, Cushman & Wakefield presumes a baseline scenario that presumes moderate efficiency gains from stable AI adoption, in addition to secure employment levels sustained by continued hiring in office-intensive industries.
In opposition to this background, the firm anticipates demand for higher-quality work spaces to be reinforced, even as some work gets changed by AI. “As regular tasks become significantly automated, work environments are expected to play a greater role in cooperation, innovation and client involvement,” Brown discussed.
Regardless, Singapore’s setting as a center for technology, expert solutions and other knowledge-intensive organizations provides it an advantage as AI adoption accelerates, said Natalie Craig, chief executive of Cushman & Wakefield Singapore.
At the same time, new prime office supply remains minimal, which will further support the Grade A market. Cushman & Wakefield jobs vacancy for Grade A workplaces in the CBD to tighten up to 3.7% by the end of this year and fall listed below 2% past 2029. On the other hand, rents are forecast to increase 4.8% this year.
Based on the scenarios, CBD Grade An office vacancy in Singapore is forecasted to range in between 1.5% and 4.9% by 2030, compared to 4.4% as by the end of 2025. Meanwhile, rental movement for Grade A workplaces could vary from 6.5% growth to a decline of 2.3% in 2030. In contrast, leas expanded by 2.2% in 2025.
As a result, as more services gravitate to better offices, the trip to high quality can expand the existing space in between prime and non-prime work spaces. According to Cushman & Wakefield, Grade A workplaces regulate a rental premium of 48% over Grade B offices since 2026, boosting from 34% in 2019.
While the expanding adoption of AI is set to improve how organizations utilize the work environment, it is unlikely to significantly decrease need for Grade An office space in Singapore, according to Cushman & Wakefield.
The study looked at four circumstances with different presumptions associating with the price of AI adoption, along with economic and labour market effect. The scenarios represent a spectrum of possible results– AI-led efficiency growth driving raised need for office space on one end, and AI-driven labour shift weakening renting need on the other.
