SINGAPORE (THE BUSINESS TIMES) – The prices and rents of Singapore industrial spaces continued to climb in the second quarter of 2022, while occupancy rates inched up after dipping in the first quarter this year.

The prices of industrial developments rose 1.5 per cent quarter on quarter and 5.2 per cent year on year, according to JTC’s quarterly market report released on Thursday (July 28).

Multiple-user and single-user factory prices continued to trend upwards, gaining 1.7 per cent and 1.2 per cent respectively on the quarter and 5.5 per cent and 4.8 per cent respectively on the year.

Rents were 1.5 per cent higher on the quarter and up 3.4 per cent on the year. Multiple-user factories and warehouses each saw a 2.1 per cent increase in rents, while single-user factories and business parks edged up 0.4 per cent and 0.2 per cent respectively.

Overall occupancy improved slightly to 90 per cent from 89.8 per cent in the first quarter as new demand for multiple-user factories and warehouses outstripped supply. Year on year, however, occupancy was down 0.2 per cent as previously delayed completions came on stream in recent quarters, JTC noted.

As at end-June, there were 51.3 million square metres (sq m) of industrial space available. Transaction volume was up 36 per cent year on year, according to estimates based on caveats lodged for industrial properties.

Total available stock rose 322,000 sq m in the second quarter compared with the previous quarter, which saw a stock increase of 333,000 sq m. JTC noted that the 655,000 sq m increase in available space in the first half of 2022 was the most significant half-yearly increase since 2017.

In Q2, JTC allocated 207,200 sq m of ready-built facilities (RBF) space to industrialists. This included 118,100 sq m of land-based factory space and 77,100 sq m of high-rise space. JTC’s newer developments such as JTC Space @ Tuas and JTC Logistics Hub @ Gul were among the high-rise space allocated.

Total RBF returns stood at 75,900 sq m, of which 45,800 sq m was for land-based factory space, while 23,100 sq m was for high-rise space. JTC said that 74 per cent of total returns were due to natural expiries or companies consolidating their operations.

JTC expects around 1.6 million sq m of new industrial space to hit the market in the second half of 2022. Some 43 per cent of the new supply will be from single-user factory space, 30 per cent from multiple-user factory space and 27 per cent from warehouse and business park space.

It also expects around 2.7 million sq m of industrial space to be completed between 2023 and 2025, which translates to an average annual supply of around 1.2 million sq m from now until the end of 2025. The average annual supply and demand for industrial space was around 700,000 sq m over the past three years, JTC added.