Average strata office prices rise despite fewer deals, while retail activity slows
The divergence signals stronger demand for quality offices than retail units, potentially prompting pragmatic office pricing while steering retail buyers toward affordable, high-footfall premises.
Singapore’s average strata office price rose 11.3% to $2,476 psf in 1H2026 despite transactions falling 16.5%, while strata retail prices declined 24.4% to $2,580 psf.
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Singapore’s strata commercial property market delivered a mixed performance in the first half of this year, with the office segment proving more resilient than retail.
According to Knight Frank’s research, 136 office transactions were recorded in 1H2026, easing by 16.5% from 2H2025.
These deals amounted to $352.1 million, dipping slightly from $355.8 million in the second half of last year.
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The moderation was cushioned by an 11.3% rise in average unit prices, from $2,224 psf in the previous half-year period to $2,476 psf in the first half of this year.
Knight Frank said the price increase suggests buyers and investors remained willing to pay a premium for well-located, quality strata office assets.
Leasehold properties accounted for the bulk of strata office transactions, with 90 leasehold units changing hands, for a total of $227.2 million. That is down 19.8% from $283.4 million in the second half of 2025, when 125 units were sold.
Even so, average prices held firm, edging up by 1.7% to $2,260 psf.
Meanwhile, freehold office units recorded 46 deals, fetching a total of $124.9 million — jumping by 72.6% from $72.4 million across 38 units in 2H2025.
The average unit price for freehold strata offices rose 34.0% to $2,999 psf over the same period.
The largest strata office transaction by price quantum in 1H2026 was at GB Building on Cecil Street, where 10 units collectively fetched $22.5 million in February. That works out to $1,787 psf based on the combined strata area of 12,594 sq ft.
Demand for strata offices remained concentrated in the Downtown Core Planning Area, where 49 units changed hands for a total of $187.5 million.
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Outside the CBD, demand was focused on established city-fringe locations such as the Singapore River and Geylang Planning Areas.
The Kallang Planning Area stood out with 16 transactions amounting to $26 million — double the number of deals recorded in the second half of last year.
The pickup in activity could signal growing confidence in Kallang's long-term commercial prospects, as the precinct's transformation under the Kallang Alive Master Plan gathers momentum, the consultancy wrote.
Softer retail sales and prices
Within the strata retail market, the report recorded a more pronounced pullback. There were 135 strata retail transactions in the first half of this year, down 27.0% from 2H2025.
Total sales value fell in tandem, dropping 28.3% to $336.1 million, while average unit prices declined 24.4% to $2,580 psf over the same period.
Of the total retail transactions logged in 1H2026, only four were above $10 million, compared with nine out of 185 deals in the previous half-year period.
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The two largest transactions by price quantum in 1H2026 were part of a portfolio sale of retail assets from Mercatus, the real estate and investment arm of NTUC Group.
These included the acquisition of two basement retail units at Bukit Timah Plaza for $65.4 million ($1,459 psf), and a unit at Coronation Shopping Plaza for $32.4 million ($3,177 psf), both acquired by Altallo Asset Management in February.
Outlook for strata offices and retail
Despite the muted activity in strata retail, the market has consistently transacted between 30 and 50 units in the $500,000 to $1 million price range every half-year since 1H2015.
Knight Frank says this suggests there remains a pool of relatively more affordable opportunities that could appeal to owner-occupiers looking beyond leasing.
The report adds that when acquiring a strata retail unit, locations with frontage and exposure to a regular stream of pedestrian traffic would be vital to business viability.
That said, retailers and F&B operators that can successfully draw shoppers and diners to hole-in-the-wall locations in strata retail complexes might be able to find commercially feasible and cost-effective operating premises, outside of large landlord- or Reit-owned malls.
In the strata office market, realistic pricing remains key to bridging the gap between buyers and sellers.
While office prices remained resilient despite softer transaction volumes, some owners may eventually adopt more pragmatic pricing strategies to unlock liquidity.
Knight Frank noted that if such pricing recalibration gathers pace, it could stimulate buying interest and improve market activity, particularly for well-located city-fringe and decentralised office assets, where boutique occupier and investor demand continues to be present.