SINGAPORE (EDGEPROP) - Industrial rents and prices have fallen 0.9% q-o-q and 2.2% q-o-q respectively in 3Q2020, based on real estate statistics released by JTC on Oct 22.
Compared to a year ago, the rental index has fallen by 1.6%, while the price index has dropped by 3.9%.
The transaction volume of industrial properties increased from 112 transactions in 2Q2020 to 320 in 3Q2020, which JTC attributes to the pent-up in demand following the lifting of “circuit breaker” measures.
Overall industrial occupancy rate increased by 0.2 percentage points q-o-q, and 0.3 percentage points y-o-y. This was driven by an increase in demand for storage amid a delay in new completions, says JTC. In 3Q2020, only 24,000 sq m (about 258,300 sq ft) of new industrial spaces was completed, marking the lowest quarterly completions on record, and a significant reduction from the average quarterly completions of around 270,000 sq m in the past three years, it notes.
Among the segments, occupancy rates for multiple-user factory space, warehouse space and business park space all rose on a q-o-q basis, while occupancy rates for single-user factory space fell marginally by 0.1 percentage point (see infographic).
Looking ahead, JTC forecasts that about 0.6 million sq m of new industrial space is expected to be completed in the last quarter of 2020. This is a sharp reduction from the 1.3 million sq m of new industrial spaces originally expected to be completed in H22020. It expects 0.7 million sq m of new industrial spaces to come into the market only in 2021 and 2022, due to the pandemic’s impact on the built sector.
JTC expects Covid-19 to continue weighing on the industrial property market, with continued downward pressure on prices and rentals in the upcoming quarters and construction delays for some projects.