AI to reshape, not reduce, demand for Singapore Grade A offices: C&W
The range of outcomes shows a “durable” prime office market, with openings remaining below 5%, mentioned Dr Dominic Brown, head of international research study at Cushman & Wakefield. “It reveals why the impact of AI on property can not be understood through jobs alone– supply, productivity, business growth and the modifying role of the work environment all issue.”
The study evaluated 4 scenarios with various assumptions relating to the price of AI adoption, together with economic and labour market effect. The scenarios represent a range of potential outcomes– AI-led productivity development driving raised need for office space on one end, and AI-driven labour displacement weakening renting need on the other.
Amongst the four scenarios designed in its study, Cushman & Wakefield presumes a standard situation that thinks moderate productivity gains from steady AI fostering, in addition to secure work levels supported by ongoing hiring in office-intensive sectors.
At the same time, brand-new prime workplace supply remains restricted, which will additionally sustain the Grade A market. Cushman & Wakefield jobs openings for Grade A workplaces in the CBD to tighten up to 3.7% by the end of this year and fall below 2% beyond 2029. Meanwhile, rents are forecast to increase 4.8% this year.
Regardless, Singapore’s position as a center for technology, expert solutions and various other knowledge-intensive organizations offers it a benefit as AI adoption increases, stated Natalie Craig, chief executive of Cushman & Wakefield Singapore.
“As companies reconsider just how and where their individuals work, we anticipate demand to become more careful, consequently putting an even higher premium on quality, connectivity and adaptability,” she added.
Subsequently, as even more organizations gravitate to better workspaces, the flight to quality can broaden the existing gap between prime and non-prime workspaces. According to Cushman & Wakefield, Grade An offices command a rental premium of 48% over Grade B workplaces as of 2026, boosting from 34% in 2019.
While the growing adoption of AI is readied to improve how companies use the workplace, it is unlikely to substantially lower demand for Grade An office space in Singapore, according to Cushman & Wakefield.
In opposition to this backdrop, the firm expects demand for higher-quality work spaces to be enhanced, even as some work gets replaced by AI. “As routine tasks end up being significantly automated, offices are anticipated to play a better role in cooperation, innovation and client involvement,” Brown described.
In a September investigation record titled AI Impact: Office Insights Singapore, the real estate services firm studied the potential effect of AI adoption on Singapore’s economic climate, workforce and business real estate through to 2030.
Based upon the situations, CBD Grade A workplace vacancy in Singapore is forecasted to range in between 1.5% and 4.9% by 2030, compared to 4.4% as at 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, rental fees grew by 2.2% in 2025.
