Industrial rent grows for the third consecutive quarter by 0.6%

The occupancy rate for the overall industrial property market was at 90.1% as of end-June.

Industrial rents grew by 0.6% quarter-on-quarter in the second quarter, marking the third quarter in a row of rent increases, according to the latest data from JTC.

Rental growth was seen in multiple-user factories, single-user factories, and warehouses, at 1.0%, 0.1%, and 0.2% quarter-on-quarter, respectively. Rents in business park spaces remain unchanged since the third quarter of last year.

The occupancy rate for the overall industrial property market was at 90.1% as of the second quarter, a marginal increase of 0.1% from last quarter, or by 0.7% compared to the same quarter last year.

“While delays in completion continue to persist, new completions started to pick up in the second quarter of 2021, and the total available stock rose by 374,000 sq. m. compared to the previous quarter. This is the largest quarterly increase since 2017,” JTC said in its report.

Approximately 1.7 million sq. m. of new industrial space is expected for completion by the second half of the year, 46% of which are single-user factory space, 31% multiple-user factory space, and 22% business park and warehouse space.

The government expects the demand for industrial space to continue to increase. But the rise in occupancy might be tempered by new completions and the increase of supply. Prices and rentals are expected to stay stable.

“This aligns with the key industrial indicators which similarly exhibited signs of sustained growth, as the economy continues its recovery in 2021 – manufacturing output rose by 30.0% year-on-year (YoY) in May 2021, NODX increased by 8.8% YoY in May 2021, whilst SIPMM’s PMI maintained its expansion for the eleventh consecutive month in June 2021,” said CBRE in a separate statement.

Read the full JTC report here.