Impact of Upcoming Office Supply in Punggol Digital District on Occupancy Rates at Changi Business Park
Ministry of Trade and IndustrySpeakers
Summary
This question concerns the occupancy rates at Changi Business Park (CBP) and the potential impact of upcoming office supply from the Punggol Digital District (PDD). Mr Liang Eng Hwa asked about vacancy trends and whether the offerings of business parks require improvement to attract new demand. Deputy Prime Minister and Minister for Trade and Industry Gan Kim Yong stated that CBP’s occupancy was 69.6% in early 2024, down from the decadal average of 82.4%. He noted that PDD is unlikely to impact CBP significantly because they cater to different sectors, namely emerging technologies versus financial back-end support. JTC Corporation will continue monitoring vacancies and working with agencies to improve the appeal and relevance of business parks for a wide range of occupants.
Transcript
80 Mr Liang Eng Hwa asked the Deputy Prime Minister and Minister for Trade and Industry (a) whether the Ministry can provide an update on the state of occupancy at the Changi Business Park (CBP); (b) whether vacancies at CBP will increase with upcoming new supply of office space, such as the Punggol Digital District; and (c) whether the overall offerings and the attractiveness of the business parks need to be improved to bring in new demand.
Mr Gan Kim Yong: As of the first quarter of 2024, the overall occupancy at Changi Business Park (CBP) was 69.6%, lower than the occupancy of 71% in the previous quarter and the average occupancy of 82.4% over the past decade.
The JTC Corporation (JTC) does not expect the upcoming supply of spaces at Punggol Digital District (PDD) to significantly affect vacancies at CBP, as PDD and CBP cater to different industries. CBP's tenants are predominantly financial institutions engaged in back-end support, whereas PDD’s tenants are primarily in emerging technologies, such as cybersecurity, artificial intelligence and robotics, fintech and smart living.
JTC monitors the vacancies of business parks closely. Overall occupancy for business parks remains healthy at 78% as of the first quarter of 2024. While there appears to be lower occupancy in older estates and estates further from the city centre, we do not observe inherent weakness in any specific sector. JTC will continue working with other agencies to improve the value, appeal and relevance of our business parks, so that they remain attractive to a wide range of occupants.