Singapore’s Industrial Property Market’s Upward Trend in Q4 2023

In the fourth quarter of 2023, Singapore’s industrial property market demonstrated remarkable resilience and stability, driven by the country’s economic expansion. Key indicators suggest sustained growth, drawing keen interest from investors and stakeholders in this dynamic sector.

Leasehold Price Trends

Savills' latest report highlights notable price movements across various leasehold tenures. Freehold industrial properties saw prices rise by 0.7% to S$808 per square foot. Similarly, 60-year leasehold industrial properties experienced a 1.1% quarter-on-quarter (QoQ) increase to S$504 per square foot. Meanwhile, 30-year leasehold industrial properties showed a modest 0.2% QoQ uptick, reaching S$323 per square foot. These increases underscore the continued demand and investor confidence in the industrial real estate segment.

Rental Dynamics and Demand

The rental market for prime industrial warehouse space maintained its upward trajectory, with monthly rents rising by 1.7% QoQ to S$1.65 per square foot, reflecting a substantial 7.4% year-on-year (YoY) growth. Rents for multiple-user factories remained steady at S$2.22 per square foot, marking a significant 10.5% rise from 2022. This trend indicates robust demand for industrial spaces, particularly in warehousing and logistics, driven by Singapore’s strategic role as a regional trade and logistics hub.

Leasing Activity Surge

The fourth quarter of 2023 saw a notable surge in leasing momentum, with total leasing volume increasing by 4.1% YoY to 3,070 tenancies. This uptick reflects sustained business activity and expansion plans among industrial tenants, fueled by economic growth and favorable market conditions. The rise in leasing activity underscores the attractiveness of Singapore’s industrial properties for businesses seeking strategic locations and modern facilities to support their operations.

Economic Growth Resilience

Singapore’s economy showcased resilience and momentum, achieving a year-on-year growth rate of 2.7% in the first quarter of 2024, up from the 2.2% growth recorded in the previous quarter. With the consistent economic performance, the industrial property market is poised for continued growth.

Future Prospects

Ongoing infrastructure developments and innovations in industrial real estate promise a dynamic and resilient market landscape, offering diverse opportunities for investment and growth. The Singapore industrial property market remains appealing amidst broader economic trends, with sustained growth in prices, rentals, and leasing activity signaling its vitality and resilience.

In conclusion, whether you're a startup seeking flexible space, a manufacturing company requiring specialized facilities, or a technology firm in need of a collaborative environment, we have a property class tailored to your needs. For personalized advice on the best property type for your requirements, contact our industrial property experts for a complimentary consultation. We're dedicated to helping you make informed decisions and leverage the full potential of Singapore's dynamic industrial property market.

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