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Singapore industrial market staying resilient

  • Singapore's industrial property market continued its recovery into H1 2021, with the JTC rental and price indices increasing 1.1% HOH and 2.7% HOH, respectively.
  • Warehouse rents are expected to grow 1.3% YOY in 2021, led by ramp-up logistics space.
  • Total net absorption growing by 58.4% HOH to 5.5 million sq ft in H1 2021.
  • Occupancy edged up 0.2 ppt to 90.1%, led by Multi-user factory despite a surge in supply.
  • Single-user factory transactions surged 214% HOH by value.
  • Cap rates for Singapore industrial properties remained unchanged in H1 2021, at 5.75–6.25%.

SINGAPORE, 18 August 2021 -- Colliers (NASDAQ and TSX: CIGI), a global leader in commercial real estate services, has today published its research reports which examine the market performance of the industrial property sector in the first half of 2021 (H1 2021) and its projections for the industry.

Based on Colliers' Research, Singapore's industrial property market continued its recovery into H1 2021, with the JTC rental and price indices increasing 1.1% HOH and 2.7% HOH, respectively, while occupancy edged up 0.2 ppt to 90.1%, led by Multi-user factory despite a surge in supply.

2021 H1 Industrial Report new supply demand and vacancy rate

 

In 2021, Colliers Research expects the industrial sector to recover along with the overall economy and forecasts warehouse rents to rise 1.3% YOY, the highest among all segments, led by ramp-up logistics space. 

"Business Park and Factory rents could rise at a slower rate of 0.5% YOY and 0.7% YOY respectively given ample supply, and we expect rents of hi-specs space to grow 0.8%, supported by Singapore's growing technology sector", added Raphael Lee, Associate Director, Industrial Services at Colliers.

Singapore's industrial market saw its total net absorption grow by 58.4% HOH to 5.5 million sq ft in H1 2021 despite supply surging 8.5x HOH.  "Planned supply for 2021 remains high at 1.6x the 10-year historical average, 69% of which comes from factories, although construction delays could potentially avert an oversupply situation", commented Lee.

2021 H1 Industrial new supply by type

 
"Investor's demand for industrial assets remains strong, particularly for hi-specs space, factories and warehouses. "There were a few major deals transacted in H1 2021, and single-user factory transactions surged 214% HOH by value", commented Donald Goh, Director, Investment Services at Colliers. 

According to Colliers Valuation and Advisory Services (CVAS) team, cap rates for Singapore industrial properties remained unchanged in H1 2021, at 5.75–6.25%.
 

Download Colliers' Bi-annual Industrial Report for H1 2021 today. 

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Media Contact:

Annabelle Taylor