SECONDARY OFFICE SPACE LOCATION

Abstract

The increasing economic growth, over the years, saw a rising demand for office space developments. This is especially so in the Central Business District. However, the limited land area in the CBD restricted further construction of office buildings and only a few pockets of sites are now left for development. It has led to the progressive expansion of office developments from the Central Area to secondary locations. The shift increases the locational choice of firms and hence the firm's locational advantage is optimised. This study basically concentrates on the reasons why firms choose to locate in these secondary areas. Case studies of firms located in Alexandra Road and Bukit Timah Road were undertaken. A diversified range of office firms were surveyed to ensure that they represented a well balanced sample of office space in these two locations. An analysis of the locational factors was undertaken. From the results, the most important locational factor that firms in these two locations take into consideration is the fact that by locating in these places, they are then not subjected to the Area Licence Scheme. Firms also placed high importance on the lesser rental costs they have to incur in occupying an office space in comparison with the CBD.