Singapore Commercial Real Estate: Market Trends & Forecast with Ang Chee Hian

Are you missing the signals in Singapore's commercial property market? Still following old market reports or relying on residential trends? You might be missing out on some of the most strategic plays in Singapore's commercial real estate market. 

Right now, smart money is moving strategically. From data centres to mixed-use districts, experienced investors are placing capital where performance is quietly outpacing the hype.

Ang Chee Hian, a seasoned expert in high-value property investments, breaks down the shifts you need to know. Let's break down what's actually happening in 2025- with real numbers, real deals, and future-facing insights. 

Growth Isn't Just a Trend- It's a Strategy

Singapore's commercial real estate market is set to grow at a 6.5% CAGR through 2030. While residential still dominates volume, more institutional investors are turning to industrial and commercial zones for their reliable rental yields and policy stability.

Why does this matter? Because smart capital isn't just chasing headlines- it's flowing into areas that can grow consistently over the long term.

Offices: Flight to Quality Is Still Paying Off

Grade-A offices in the CBD? Still hot.

• Rents rose 0.6% in Q2 2025

• Vacancy dipped to 5.2% (and even lower for newer builds)

So, what's the driving force behind it? It's the demand from finance, legal, and tech sectors- especially for buildings with green credentials and smart infrastructure. Older office buildings are being left behind, while modern, flexible spaces are attracting both tenants and long-hold investors.

Industrial & Logistics: Yields Are Cooling, but Still Competitive

Yes, rents are still rising- up 0.7% in Q2, for the 19th straight quarter. Vacancies have ticked up to 11.2%, mostly due to new supply, but business parks and next-gen warehouses are holding their value. What's performing best?

• Proximity to Tuas and Changi

• Automated facilities

• Sustainable builds

These factors are keeping investor interest high- even with a slight softening in yields.

Data Centres: Where the Big Bets Are Going

Investor interest surged with NTT DC REIT's S$1B+ IPO in mid‑2025- the largest in four years. Meanwhile, CapitaLand Ascendas REIT acquired fully-leased digital assets at discounts, anchoring institutional confidence. Keppel reported a 45% profit boost in its connectivity footprint, driven by AI-related growth.

Why it matters: Singapore has one of the lowest data centre vacancy rates in the world (just 2%). With yields between 6.5% and 7.5%, this is prime territory for investors chasing performance and long-term relevance.

Retail & Mixed‑Use: It's All About Experience Now

It's not just about retail space anymore- it's about placemaking.

Projects like One Holland Village, Canning Hill Piers, and Union Square are blending retail, lifestyle, and residential- driving consistent foot traffic and diverse tenant interest.

With tourism back near pre-pandemic levels, the best-performing retail properties are:

• Near MRT stations

• Integrated into lifestyle districts

• Offering more than just shopping

These spaces are creating long-term value far beyond one-off transactions.

What's Next? Future Catalysts to Watch

Big developments are coming- and they'll shift the commercial landscape even further:

• Skywaters Residences (by 2028) will be Singapore's tallest tower- with office, retail, hotel, and homes in one

• The AXA Tower redevelopment

• Liang Court's transformation into CanningHill Piers

Each of these will spark new demand and raise the bar for surrounding real estate performance.

Regional Context & Economic Pressures

Even with slower GDP forecasts (0–2%) and longer deal timelines, Asia-Pacific commercial real estate volume rose 15% YoY in Q2 2025 to US$31.2B.

What's the strategy now? Investors aren't spreading their bets- they're zoning in on high-performing submarkets with solid fundamentals.

Foreign Investment? Still Strong

Singapore remains a global favorite for cross-border capital. Why?

• Transparent legal system

• Stable currency

• Business‑friendly governance

Foreign buyers are especially interested in high-WALE assets in sectors like industrial, data centres, and office, where income is stable and long-term.

Ready to Navigate These Market Shifts?

Commercial real estate in Singapore isn't about chasing trends- it's about spotting structure and seizing well-timed opportunities.

Whether it's Grade-A offices, smart logistics hubs, or digital infrastructure, this market rewards investors who move strategically- not sentimentally. With data showing clear winners across sectors, having expert guidance can mean the difference between following the crowd and leading the market.

For deeper insights into your next move, consult with Ang Chee Hian today. All inquiries are handled with complete discretion and professionalism.

FAQs

1. Can foreign investors buy commercial property in Singapore?

Yes, there are no Additional Buyer's Stamp Duties (ABSD) on commercial properties, unlike landed homes.

2. Which sectors offer the best yields based on current data?

Industrial and data centres, with yields between 5.5% and 7.5%. Offices are lower, around 3.5% and 4.2%.

3. Is the CBD office market actually recovering?

Definitely. Grade-A office rents rose 0.6% in Q2 2025, and vacancy rates dropped to 5.2%, especially for newer, green-certified buildings.

4. Why is institutional money flooding into data centres?

AI growth, digital infrastructure demand, and Singapore's 2% vacancy rate make these assets both future-proof and immediately profitable.

5. Should I consider mixed-use retail investments?

Yes, but be selective. MRT-connected retail hubs integrated into lifestyle districts are seeing the strongest demand and sustainable returns.