Office Fit-out Costs Rose 10.8% In Asia Pacific
ASIA PACIFIC – The average cost of fitting out an office space across the region has risen by 10.8 percent to US$103 psf due to a prevailing shortage of labour and raw materials, according to a new report from Jones Lang LaSalle (JLL) that was published on Thursday afternoon (25 November, SGT).
In particular, the average cost of designing and constructing a workspace in Singapore reached US$118 psf, which is slightly more affordable than Hong Kong’s US$120 psf.
Notably, JLL’s Asia Pacific fit-out cost guide for 2021/2022 measures costs based on a standard fit-out project, drawing reference from the progressive fit-out of JLL’s Grade A office at Paya Lebar Quarter in Singapore.
Meanwhile, Tokyo continues to hold the number one spot for the 5th straight year as the most expensive place to fit out an office space.
The Australian cities of Brisbane, Canberra, Adelaide, Melbourne, Perth and Sydney occupy the 2nd to 7th places respectively, while New Zealand’s Auckland is ranked 8. Finally, Hong Kong is ranked 9th, while Singapore bagged the 10th spot.
“COVID-19 continues to strongly impact the real estate and construction sectors in Asia Pacific… material shortages and supply chain disruption have driven costs up across the region in 2021,” said Martin Hinge, Executive Managing Director for project and development services at JLL Asia Pacific.
“But there are signs of green shoots. Regional vaccination rates are rising while travel has resumed with the gradual reopening of borders. There is confidence that there is life beyond the pandemic as clients plan for 2022, with technology, banking, insurance and pharmaceutical companies leading the way.”
Looking ahead, JLL expects that the cost to fit out an office space is expected to increase further in the next 12 months, especially in some markets in Southeast Asia, India, and China.
“While many of the factors that drove construction costs to increase in 2021, like supply chain disruption and raw material increases, continue to be contributing factors, there are signs that these are not necessarily pandemic-related.”
“As a semblance of normalcy returns, pandemic responses are easing across the region. With health and safety protocols in place, there is a lower risk of lockdowns as a result of increased vaccination rates,” Hinge added.
