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Prices and rents of industrial space here continued to fall in tandem in the third quarter of the year, JTC’s latest statistics released on Thursday (27 October) revealed.
Overall industrial property prices and rents fell by 1.7 percent and 2.0 percent, respectively, compared to the previous quarter. The indices also fell 7.8 percent and 7.3 percent, respectively, year-on-year.
The declines marked the sixth consecutive quarter of prices and rental revisions on both quarterly and yearly basis.
One analyst attributes the market’s sluggish performance to the slowdown in the investment demand on the back of cooling measures and high vacancy rates among completed strata-titled industrial property.
“The industrialists are taking a wait-and-see attitude after taking into consideration the prolonged slow economic growth at least until the end of 2017 going by the official GDP estimates, coupled with the uncertainties surrounding the global and regional economic recovery,” said Christine Li, director of Research at Cushman & Wakefield.
Occupancy rate also fell 0.3 percentage points from the previous quarter to 89.1 percent and dropped by 1.7 percentage points from that recorded in the same period last year.
According to JTC, about 3.0 million sq m of industrial space — including around 720,000 sq m of multiple-user factory space — is estimated to come on-stream from now till end of 2017, higher than the average annual supply and demand of around 1.9 sq m and 1.2 million sq m respectively in the past three years. The state landlord expects the upcoming supply to “exert further downward pressure on occupancy rates, prices and rentals, translating to reduced business costs for industrialists.”
Nikki De Guzman, Editor at CommercialGuru, wrote this story. To contact her about this or other stories email nikki@propertyguru.com.sg.
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