THE average occupancy rate for office space in Marina Bay surpassed that of Raffles Place for the first time this quarter, said DTZ Research.
The impetus for Singapore's new financial district came as tenants moved into Marina Bay Financial Centre Tower 3 and Asia Square Tower 1.
The average occupancy rate for Marina Bay rose by 5.1 percentage points quarter on quarter to 93.6 per cent, edging out Raffles Place on 93.3 per cent, down by 0.4 percentage points.
The average gross rent for Marina Bay held firm at $10.50 per sq ft per month in the first quarter of this year.
DTZ executive director Cheng Siow Ying said: "Leasing activity increased in Marina Bay as rents are now more competitive.
"Interest for such premium- grade space came from sectors such as the commodities trading, energy and legal sectors."
In a report by DTZ, a real estate consultancy and research company, offices in the Central Business District (CBD) showed signs of weakness.
Rents at Raffles Place kept softening amid weaker demand. Average gross rents in the area fell 0.5 per cent quarter on quarter to $9.28 psf per month.
In contrast, average gross rents at Shenton Way, Robinson Road and Cecil Street stood firm at $7.25 psf per month, with the occupancy rate rising 0.3 percentage points quarter on quarter to 91.6 per cent.
Said Ms Cheng: "Increased leasing activity was also seen in the CBD fringe and decentralised locations, particularly for the newer and better specified buildings.
"Rents held up well in response to demand from companies in the chemical, engineering, technology, energy, shipping and fast-moving consumer goods sectors, as financial institutions continue to decouple their backroom operations," she added.
About 2.5 million sq ft of office space will be completed this year, said the report.
They include Asia Square Tower 2, Jem in Jurong and The Metropolis and Nexus@one-north in Buona Vista.
In total, the net increase in supply of office space will be 2.1 million sq ft, higher than the past five-year annual average of 1.8 million sq ft.
"Pre-commitments have been noted for office buildings in decentralised areas," said Ms Lay Lee Kang, head of Singapore research at DTZ.
She added: "Office rents are expected to hold firm in those areas, while rents in the CBD will continue to ease before recovering next year."