Industrial rents up 1.5% in 2Q2022, charting seventh consecutive quarter of growth

Catherine He adds that increasing worries relating to food security as well as accessibility to basic materials and also needs triggered substantial stockpiling activity, which contributed to more powerful need for stockrooms. “The strengthening Singapore money provided assistance to stockpiling, minimizing escalation in rates as inflation becomes progressively significant,” he remarks.

For manufacturing facilities, multiple-user factories saw the highest possible quarterly and also annual growth in 2Q2022 at 2.1% and also 3.7% respectively. “This could be credited to the expanding demand for high-specification multi-user factories, as occupiers look for office quality commercial spaces near the city edge,” marks He, head of research study, Singapore at Colliers.

Colliers’ He, on the other hand, highlights that new supply will come onstream at an usual total amount of around 1.2 million sqm each year from nowadays till 2025, including 1.6 million sqm to be completed this year. This outpaces the 0.7 million sqm annual average over the past 3 years, meaning that supply is likely to reach demand and also toughen up the pace of rental as well as price growth, she opines.

Storehouses charted the strongest performance among all the commercial sub-segments, registering a rental rise of 2.1% q-o-q and also 5.7% y-o-y respectively in 2Q2022. Throughout the quarter, storage facility occupancies raised to 90.9%, up from 90.3% in 1Q2022.

The development in industrial cost and also rental indices was supported by producing output expansions in electronics and also precision engineering, in addition to durable necessity for semiconductors, observes Leonard Tay, head of research at Knight Frank Singapore.

Looking ahead, Tricia Song, CBRE head of research, Singapore and also Southeast Asia, notes that commercial pipe continues to be “extremely thin”, with multi-factory pipeline expected to taper down from 2023 while the majority of storage facility supply up till 2023 is currently totally pre-committed.

19 Nassim condominium

Industrial rentals grew 1.5% q-o-q in 2Q2022, up from the 1% q-o-q development recorded the previous quarter, according to data published by JTC on July 28. This marks the seventh successive quarter of development as well as the fastest quarterly development since 3Q2013. On a y-o-y basis, leas expanded 3.4% during the second quarter.

Industrial costs likewise climbed, growing 1.5% q-o-q in 2Q2022 yet easing from the 3.1% q-o-q rise documented the previous quarter. At the same time, commercial occupancy prices inched up from 89.8% in 1Q2022 to 90% in 2Q2022.

Nonetheless, He keeps in mind that lasting need for industrial area will still be driven by tailwinds such as Singapore’s raising focus on high-value manufacturing and biomedical sectors. Colliers is predicting commercial leas to develop between 2% to 4% this year, while industrial rates are predicted to grow in between 5% to 7%.

To that end, the industrial property market is anticipated to gain from the tight supply. “Preventing any sharp downturn in the global market, demand for industrial place in 2022 is expected to be thriving as well as occupancy should be fairly secure,” Song adds.

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