Overall industrial rents in Singapore grew by 0.5% quarter-on-quarter (QoQ) in Q4 2024, but many industrialists remain cautious due to high interest rates and rising operating costs, leading to resistance against further rent hikes. The quarter marks the 17th consecutive quarter of increase.
According to Cushman & Wakefield’s analysis of JTC’s fourth quarter (Q4 2024) data, the industrial market in Singapore continues to demonstrate resilience, with rents and prices increasing, albeit at a slower pace.
For the entire year, rents rose by 3.5% year-on-year (yoy), a decrease from the 8.9% growth recorded in 2023. Multi-user factories experienced the strongest rental growth at 3.8% yoy, driven by newer and better-located stock. Warehouse rents increased by 3.5% yoy, supported by demand from third-party logistics (3PL) players amid tight supply. Single-user factory and business park rents rose by 3.2% and 1.9% yoy, respectively.
Vacancy rates remained stable at 11.0% in 2024, with all industrial segments witnessing healthy demand. Business parks saw improved demand, with a net positive demand of 0.4 million square feet in 2024, although vacancy rates rose to 22.1%, the highest since 2010. The warehouse segment experienced slightly higher vacancy rates at 8.5% due to net supply outpacing demand.
Looking ahead, Cushman & Wakefield anticipates steady rental growth of around 2% to 3% yoy for most industrial submarkets in 2025, aligned with GDP growth and inflation. However, suburban business parks are expected to see flat growth. Despite moderating rental growth, significant positive rental reversions are anticipated as leases come up for renewal.
