OCEAN Network Express, the new joint venture of Japan's "Big Three" shipping lines, is said to be taking up some 50,000 sq ft of office space at Marina One.

The joint-venture company is a consolidation of the container shipping businesses of Kawasaki Kisen Kaisha (K Line), Mitsui OSK Lines (MOL) and Nippon Yusen Kabushiki Kaisha (NYK Line). It includes their worldwide terminal operation businesses, except those in Japan.

The Business Times understands that Knight Frank brokered the lease at Marina One and Ocean Network Express is planning to use the new office spanning 1½ floors as its regional and global headquarters.

Macquarie Bank, which is now at Marina Bay Financial Centre Tower 2, is also said to be in advanced negotiations for some 50,000 sq ft of office space at Marina One.

The two new office towers at Marina One, an integrated development in downtown Marina Bay, are due to be completed soon. Developed by M+S, Marina One's 1.88 million sq ft Grade-A office space is said to be about 70 per cent pre-leased ahead of its completion.

Some consultants believe that the healthy take-up at Marina One has contributed in part to improvements in premium office rents in Marina Bay.

JLL and Cushman & Wakefield saw an uptick in gross effective rents in Grade-A CBD office space, led by the Marina Bay submarket, after a two-year rental decline.

As a sign of earlier-than-expected bottoming out, gross effective rents of Grade-A office space in the CBD edged up a modest 0.6 per cent during the second quarter to S$8.49 per square foot per month (psf pm), after declining 19.6 per cent over the last two years, JLL estimates. This was led by the Marina Bay submarket, which recorded an uptick of 1.3 per cent to S$9.51 psf pm.

"The turnaround in office rents came on the back of the firming of rents in better-quality buildings with higher occupancy rates, as well as the continued inching up of the take-up rates of recently and soon-to-be completed projects above the psychological barrier of 50 per cent," said JLL head of research and consultancy Tay Huey Ying.

"Additionally, as some occupiers have committed to space in new projects ahead of the lease expiry in their existing premises, the staggered return of space to the market has mitigated pressure on landlords to lower rental expectations to maintain occupancy," she added.

The first-half of 2017 saw a good volume of pre-committed space in the upcoming premium developments such as Marina One and UIC Building in the CBD.

Property consultancy firm Edmund Tie & Company is moving out of its 10,000 sq ft office at Shaw Tower at Beach Road and taking up 6,500 sq ft space at UIC Building. The relocation takes effect from July 21.

Edmund Tie, executive chairman of the firm, said: "The decision to move to a new office incorporating modern concepts is in alignment with the firm's strategy to embrace technology, enhance staff engagement and wellness and, through these initiatives, raise our value proposition to clients."

Ong Choon Fah, CEO of Edmund Tie & Company, said that the firm is making more productive use of its new office at UIC Building through flexible configurations. For instance, the conference room is adaptable to be used for townhalls or subdivided into smaller meeting rooms.

The new office for the firm's associate agency Edmund Tie & Company Property Network in HDB Hub is also designed based on similar principles; it has moved out of an office of about 10,500 sq ft to another office of about 4,000 sq ft within the same building.

At Guoco Tower of Tanjong Pagar Centre, which is already 90 per cent committed, Thai rubber group Sri Trang Agro-Industry Public Company is moving into close to 6,000 sq ft of office space on the 25th floor in early December, letting go of its existing 5,100 sq ft office at One Raffles Place where it has been operating for more than 10 years.

Cushman & Wakefield estimates that Grade-A CBD rents rose by 1.7 per cent in the second quarter to about S$8.51 psf pm, the first increase in nine quarters, led by a 5.8 per cent rise in premium office rents in Marina Bay. This is based on the gross effective rents achieveable for a 10,000-sq ft tenant in Grade-A CBD offices, factoring in rental incentives such as rent-free fit-out and rent holidays.

"Over the next couple of quarters, we are likely to witness a gradual rental recovery of up to 5 per cent this year, due to the much depleted supply situation from 2018 and beyond and sustained GDP growth," said Cushman & Wakefield research director Christine Li.

But not all consultants see the office market as being out of the woods just yet. Edmund Tie & Company research head Lee Nai Jia said that gross office rents in the CBD eased by 0.8 per cent in the second quarter from a quarter ago to S$8.80 psf pm, a moderate decline compared to the 1.2 per cent drop in the first quarter. This tracks premium, Grade-A and Grade-B office rents in the CBD with floor plates of 5,000-10,000 sq ft.

The Urban Redevelopment Authority is slated to release the second-quarter real estate statistics on July 28.

Based on Cushman's data, some 58 per cent of leasing activities in CBD Grade-A offices in the first half of this year have been driven by technology companies, up from 13 per cent for the whole of last year. This came on news that Uber, Grab, Microsoft and Facebook are taking up office space in the CBD.

The share from financial firms dropped marginally from 22 per cent in 2016 to 19 per cent in H1 2017.