Singapore Firms Among Most Upbeat Over Commercial Property Market
SINGAPORE – Surveyors and real estate companies polled in Singapore have the world’s most bullish view on the state of their respective commercial property markets in Q4 2022, according to the Royal Institution of Chartered Surveyors’ (RICS) latest Global Commercial Property Monitor.
Based on the Commercial Property Sentiment Index (CPSI; as shown in Chart 3), respondents across Singapore and India remain much more optimistic on the outlook of their commercial property market, with both countries showing “firmly positive readings” noted RICS.
A notable comment from among the respondents in Singapore is that its commercial real estate market appears to be resilient despite economic headwinds. In particular, RICS stated that prime office space in the city-state are forecasted to show robust growth.
Singapore and India also notched an Investment Sentiment Index (ISI) reading of 18 and 19 respectively, as both countries continue to demonstrate solid confidence in their property investment market conditions.
On the other hand, Hong Kong and China respectively registered CPSI readings of -35 and -44. This is despite the end of COVID-related measures in China towards the end of survey period.
“Consistent with the overall sentiment index, around 80 percent of respondents in Singapore and India view the market to be in either an upturn phase or the peak (Chart 5),” RICS pointed out.
In contrast, over 80 percent of respondents in China, Hong Kong, and Australia are of the opinion that their commercial property market is either in a downturn or at the bottom of the market cycle.
Even though respondents in Singapore and India are the most optimistic, macroeconomic shocks such as inflation and monetary tightening will likely add to the pressures to these markets.
“Moreover, with China and Hong Kong’s reopening from COVID restrictions, the China-India and Hong Kong-Singapore twin-city style competition will likely return. Therefore, further changes in the dynamic around commercial property will need to be watched for over the course of the next twelve months,” RICS added.
The survey questionnaires were distributed on 7 December 2022, and the responses were received until 13 January 2023. Respondents were asked to compare conditions in the latest three months with the prior quarter as well as their views on their commercial property market’s prospects. Overall, 2,511 company responses were received.