AI to reshape, not reduce, demand for Singapore Grade A offices: C&W
The series of results shows a “resilient” prime office market, with vacancy continuing to be listed below 5%, noted Dr Dominic Brown, head of international research study at Cushman & Wakefield. “It reveals why the impact of AI on realty can not be recognized through jobs alone– supply, productivity, business growth and the modifying role of the work environment all matter.”
While the expanding adoption of AI is set to reshape how companies utilize the workplace, it is unlikely to dramatically reduce need for Grade An office space in Singapore, according to Cushman & Wakefield.
Amongst the 4 scenarios designed in its study, Cushman & Wakefield posits a baseline situation that presumes moderate efficiency gains from stable AI fostering, along with steady employment levels supported by ongoing hiring in office-intensive industries.
In opposition to this background, the firm anticipates need for higher-quality offices to be enhanced, even as some work gets changed by AI. “As regular activities become significantly automated, offices are anticipated to play a better duty in partnership, innovation and client engagement,” Brown discussed.
“As services reassess exactly how and where their individuals work, we expect demand to become extra careful, thus placing an also greater premium on quality, connection and versatility,” she included.
As a result, as more companies move to far better workspaces, the flight to top quality could expand the existing space in between prime and non-prime offices. According to Cushman & Wakefield, Grade An offices regulate a rental premium of 48% over Grade B offices since 2026, increasing from 34% in 2019.
In any case, Singapore’s position as a center for innovation, expert services and various other knowledge-intensive organizations provides it an advantage as AI adoption accelerates, claimed Natalie Craig, chief executive of Cushman & Wakefield Singapore.
The study looked at four circumstances with various assumptions associating with the rate of AI adoption, together with economic and labour market effect. The scenarios stand for a spectrum of possible outcomes– AI-led productivity development driving raised interest for office space on one end, and AI-driven labour displacement weakening renting demand on the other.
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In a September investigation record titled AI Impact: Workplace Insights Singapore, the realty services firm studied the prospective influence of AI adoption on Singapore’s economic climate, employees and business property via to 2030.
Based upon the scenarios, CBD Grade A workplace vacancy in Singapore is forecasted to range in between 1.5% and 4.9% by 2030, contrasted to 4.4% as by the end of 2025. Meanwhile, rental movement for Grade An offices could vary from 6.5% growth to a decrease of 2.3% in 2030. In comparison, leas grew by 2.2% in 2025.
At the same time, brand-new prime workplace supply remains limited, which will further support the Grade A market. Cushman & Wakefield jobs job for Grade A workplaces in the CBD to tighten to 3.7% by the end of this year and fall below 2% beyond 2029. On the other hand, rents are anticipated to enhance 4.8% this year.
