AI to reshape, not reduce, demand for Singapore Grade A offices: C&W
While the growing adoption of AI is set to improve how businesses utilize the office, it is unlikely to substantially minimize demand for Grade An office space in Singapore, according to Cushman & Wakefield.
Consequently, as more businesses move to better offices, the flight to high quality might expand the existing void between prime and non-prime workspaces. According to Cushman & Wakefield, Grade An offices command a rental premium of 48% over Grade B offices since 2026, boosting from 34% in 2019.
In a September investigation report called AI Impact: Office Insights Singapore, the property companies firm studied the potential impact of AI fostering on Singapore’s economic climate, labor force and commercial real estate with to 2030.
In any case, Singapore’s setting as a center for innovation, expert services and various other knowledge-intensive businesses offers it an advantage as AI adoption accelerates, stated Natalie Craig, chief executive of Cushman & Wakefield Singapore.
Among the four scenarios designed in its study, Cushman & Wakefield assumes a baseline scenario that thinks moderate efficiency gains from consistent AI adoption, along with secure employment levels supported by ongoing hiring in office-intensive industries.
“As companies rethink exactly how and in which their people work, we anticipate need to turn into extra selective, thus putting an also higher premium on quality, connection and flexibility,” she included.
At the same time, new prime workplace supply remains minimal, which will additionally support the Grade A market. Cushman & Wakefield jobs openings for Grade An offices in the CBD to tighten to 3.7% by the end of this year and fall listed below 2% beyond 2029. At the same time, rents are anticipated to enhance 4.8% this year.
The study looked at 4 situations with various presumptions connecting to the price of AI adoption, along with economic and labour market effect. The scenarios represent a spectrum of potential outcomes– AI-led productivity development driving raised demand for office space on one end, and AI-driven labour displacement weakening leasing need on the other.
Based upon the situations, CBD Grade A workplace vacancy in Singapore is predicted 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 A workplaces could range from 6.5% growth to a decline of 2.3% in 2030. In comparison, rental fees expanded by 2.2% in 2025.
In opposition to this background, the firm anticipates need for higher-quality work spaces to be strengthened, even as some work gets replaced by AI. “As regular activities end up being increasingly automated, workplaces are expected to play a higher duty in partnership, innovation and client involvement,” Brown described.
The variety of results suggests a “resilient” prime office market, with vacancy continuing to be below 5%, mentioned Dr Dominic Brown, head of international study at Cushman & Wakefield. “It reveals why the influence of AI on property can not be comprehended with jobs alone– supply, productivity, business growth and the changing role of the workplace all issue.”
