(June 5): Chinese tech giant Tencent Holdings Ltd has moved into a new space at a prime office tower in Singapore to bring together more employees in the city state.

Staff at the social media and gaming conglomerate moved into CapitaSky, a 29-storey tower in Singapore’s central business district this week, from a WeWork Cos office at 30 Raffles Place, according to people familiar with the matter, who asked not to be identified discussing private matters. A Tencent spokesperson confirmed that the company had moved staff to the new location.

For now, Tencent is taking up one floor, or about half of a 56,000 sq ft (5,203 sq m) flexible working space in the tower. The firm may eventually move staff from another co-working centre at the nearby CapitaSpring tower when the lease ends into the new space, said the people.

Other tenants in CapitaSky include Allianz SE and Boston Consulting Group Inc, according to the building’s majority owner CapitaLand Integrated Commercial Trust. The Work Project, a co-working operator backed by CapitaLand Group, operates both the CapitaSky and CapitaSpring spaces. Its head of sales Sheena Goh confirmed the move in a statement, saying it affirms its “three-year strong partnership” with Tencent.

“We recently relocated one of our offices from 30 Raffles Place to The Work Project at CapitaSky due to the conclusion of our lease agreement,” the Tencent spokesperson said. “We are excited to continue our business in Singapore.”

Tencent’s move reflects the cautious mood in an office market showing early signs of weakness due to rising lay-offs in sectors like tech and finance, along with the shift to working from home. Some firms are consolidating staff in one location, while keeping the option for future expansion if needed. Others including Meta Platforms Inc, Citigroup Inc and BNP Paribas SA have moved to cut space.

Still, Singapore has so far skirted the downturns seen in other cities, with vacancy rates for prime central business district offices hovering at 2.6% at the end of the first quarter, according to Colliers International Group Inc. That’s less than a fifth of the rate for Central-based offices in Hong Kong, a rival financial hub.

Singapore has benefited from an influx of wealth and firms, particularly from China, as companies seek to expand regionally and reduce their presence at home amid rising US tensions. That includes TikTok Inc, which has set up its headquarters in the city state, as well as clothing firm Shein Group Ltd.