Proportion of new office leases by space fell sharply from 15% last year to 6% in 1H2015 as companies turned pessimistic amid mounting macroeconomic uncertainties. Renewal contracts dominated leasing deals this year, accounting for 44% of the space leased, up from only 21% in 2014.

There is also a growing number of tenants that are considering non-core Grade A buildings and business parks, drawn by lower rents. Said Christine Li, Head of Research at Cushman & Wakefield Singapore, “A majority of relocation is flight-to-value, meaning companies are signing up contracts in cheaper buildings away from the CBD. This is a big turnaround from 2014, where flight-to-quality was the main theme.”

In 2Q2015, BBC Asia Bureau vacated its Shaw Tower office for a 10,000 sq ft space in Aperia, a high-tech industrial park in Kallang. Separately, Dimension Data let go of its Suntec Tower 4 office and found a new home in Aperia spanning 55,000 sq ft.

In addition, an estimated 869,000 sf of prime office space which commands higher rents, will become available as financial services firms move out of the central business district over the next six months. Banks including Barclays, Standard Chartered Plc and Credit Suisse Group AG are consolidating operations in existing offices.