AI-ready Singapore poised to capture shifting office demands, CapitaLand says

About 86% of tech firms are expected to expand in 2026, CapitaLand Investment said.

Singapore’s office market is well-positioned to capture demand shifts from both artificial intelligence (AI)-native firms and traditional occupiers as AI reshape space requirements, according to CapitaLand Investment (CLI).

"Singapore’s office and business park market fundamentals remain solid, driven by strong AI infrastructure, a highly AI-literate workforce, and a well-managed supply of quality workspace attracting global AI leaders and start-ups," CLI said in its April report. 

These equip Singapore to seize demand driven by the growing adoption of AI, which has prompted occupiers to look for high-quality office spaces. 

The strongest demand is seen in the technology software and services sector, with 86% of Singapore occupiers planning to expand this year. 

This is underpinned by the limited Grade A completions in the city-state, keeping vacancy rates at just 4%-5%. CLI added that only around 350,000 square feet of new office space are expected by 2028.  

CLI also noted the business park subsector has started to stabilise, with tenants now exploring expansion. "Despite caution on long-term commitments, AI has not led to reduced space requirements or downsizing. BPs with technology, biomedical, and research tenants remain resilient, supported by nearby research institutions, hospitals, and the growing AI ecosystem," CLI said. 

The government also reinforces Singapore's push as a high-quality office hub with initiatives like AI Park (Kampong AI), which will host approximately 70 additional AI firms, and the upcoming 27 International Business Park.