Industrial property prices, rents up in Jan-March period

Prices and rents of industrial space continued to rebound in the first quarter but the numbers are still down from last year.

JTC data yesterday showed that industrial property prices climbed 0.9 per cent from the final quarter of last year to the first three months of this year, while rents rose 0.6 per cent.

The increases came as higher demand met low supply brought about by the pandemic's interruption of construction.

Around one million sq m of industrial space was initially expected to be completed in the first quarter but only about 131,000 sq m was achieved.

Prices are still down 1.3 per cent from the same three-month period last year while rents are 0.9 per cent under. Most segments saw a quarter-on-quarter drop in occupancy rates. Business parks took the lead with a 0.7 per cent fall, followed by single-use factories and warehouses, which slipped 0.1 per cent each.

This was offset by multiple-user factories, whose occupancy grew 0.5 per cent from the fourth quarter of last year to the first three months of this year.

Nearly all segments reported year-on-year growth except business parks, which fell 0.9 per cent. Overall occupancy rates increased 0.8 percentage point over the previous year.

JTC allocated 87,000 sq m of ready-built facilities to industrialists in the first quarter. This included 61,000 sq m of high-rise space and 18,700 sq m of land-based factory space.

It projects that demand for industrial space will lift as the economy recovers further this year.

"Any potential rise in occupancy is likely to be tempered by new completions and the increase in supply into the market. As such, prices and rentals are likely to remain stable," it added.

There was 50.1 million sq m of industrial space as at March 31.

JTC expects 2.4 million sq m of new space to be completed by the end of the year, with another 1.6 million sq m next year.

THE BUSINESS TIMES

0.9% Increase in industrial property prices from the final quarter of last year to the first three months of this year.

0.6% Rise in rents over the same period.