Singapore industrial rents, prices rise in Q2 as occupancy edges down: JTC

[SINGAPORE] Rental rates of Singapore industrial properties rose 0.7 per cent for the second quarter, compared with the quarter before, JTC’s latest quarterly market report released on Thursday (Jul 24) indicated.

Compared with Q2 2024, the rental index rose by 2 per cent, representing the smallest year-on-year increase since 2021, said JTC.

Business park rentals had the highest quarter-on-quarter growth at 1.2 per cent. The year-on-year growth for this segment stood at 2.3 per cent.

The multiple-user factory segment logged 0.9 per cent growth on the quarter, and 2.2 per cent growth compared with the previous year.

Both the single-user factory and warehouse segments logged 0.4 per cent growth compared with the prior quarter, and 1.1 per cent growth and 1.9 per cent growth, respectively, on the year.

The price index of all industrial space climbed 1.4 per cent from Q1, and 5.5 per cent compared with the previous corresponding period.

Multiple-user factory prices rose 1.7 per cent on the quarter, and single-user factory prices climbed 0.4 per cent. On a month-on-month basis, multiple-user factory prices grew 6.4 per cent and single-user factory prices gained 3.5 per cent.

Overall occupancy rate for the industrial property market stood at 88.8 per cent, falling 0.2 percentage points compared with the previous quarter and the previous year. As at the end of Q2, there were 54 million square metres (sq m) of industrial property space, JTC said.

The slight decline in overall occupancy rate was attributed to substantial new completions, such as World Gateway 2 in the warehouse segment and JTC Space @ Ang Mo Kio in the multiple-user factory segment, JTC said.

Notwithstanding this marginal decline, overall occupancy for the industrial property market has remained stable at around 89 per cent since 2023, JTC added.

Meanwhile, the occupancy rate for business parks rose 0.8 percentage points on the quarter as tenants moved into newly completed developments.

In Q2 2025, demand for business parks rose by 63,000 sq m compared with Q1, of which 55,000 sq m was in Punggol Digital District, JTC said.

Supply outlook

About 300,000 sq m of new industrial space could be completed in the second half of 2025, JTC said.

Single-user factory space will account for the largest chunk of this supply at around 48 per cent. Multiple-user factory and warehouse space will respectively constitute 27 per cent and 25 per cent of the supply, JTC added.

In 2026 and 2027, an additional 2.9 million sq m of industrial space is expected to be completed, translating to an average annual supply of around 1.3 million sq m from now until end-2027. 

Of this, single-user factory space will account for the largest portion of space, at around 1.7 million sq m. Some 740,000 sq m will comprise warehouse space, while another 478,000 sq m will be multiple-user factory space.

Over the past three years, the average annual supply of industrial space stood at 900,000 sq m, while average demand was 600,000 sq m.