Commercial real estate consultancy Colliers International ranked Hong Kong, Tokyo and Singapore as the three most expensive office locations among 28 Asia-Pacific cities in Q1, 2013.
The ranking has held steady since Q1, 2011, when Hong Kong beat Tokyo to the top spot. Singapore has been ranked third since Q3, 2009.
Annual gross rents of Singapore's CBD Premium and Grade A office space in the first quarter were US$81.19 per sq ft, US$13.53 higher than fourth placed Sydney.
Hong Kong's annual gross prime office rents were US$112.86 per sq ft, while for Tokyo it was US$93.24 per sq ft.
Singapore's high ranking comes despite the rents being on a downtrend, with a quarter-on-quarter (q-o-q) fall of 2.4 per cent from US$83.21 per sq ft in Q4, 2012.
In local currency terms, the average monthly gross rents of Singapore's CBD Premium and Grade A office space eased by 0.7 per cent q-o-q to S$8.41 per sq ft as at end-March 2013.
The first quarter figures for Singapore are affected by a re-basketing exercise conducted in that period to update Colliers' properties in the different micro-markets here.
This is in contrast to the largely stable Q1, 2013 Grade A office rents in Hong Kong, which only rose q-o-q by 0.03 per cent.
Therefore, said Colliers, Singapore's cost competitiveness has strengthened against Hong Kong, its closest rival.
The office rent differential between the cities has widened from 35.6 per cent in Q4, 2012, to 39 per cent in Q1 2013.
Colliers said in its Asia-Pacific Office Market Overview for the quarter: "Weighed down by continued downside risks on the global economic front, CBD office rents in Singapore are expected to stay on a downtrend in 2013, but improving local market fundamentals could cushion and cap the fall in office rents to less than 5 per cent for the whole year."
Among the 28 cities, Bangkok's rents saw the greatest q-o-q increase of 9 per cent in US dollar terms, seeing high demand in the CBD. This moved it up four slots to 19th place.
Jakarta shot up the most on the rankings, from 18th in Q4, 2012, to 13th place.
Tokyo had the steepest q-o-q fall in annual gross rents of 6.4 per cent, as its rents are "bottoming".
This overview follows Colliers' Q1 report on the Singapore office market, released in April this year.
It predicted rents to continue sinking and cited, however, that Singapore's regional hub status and the upturn in its economy as factors which could raise rental demand.
Source: Business Times, 30 May 2013