Rents to inch up at Singapore retail, office, industrial properties of rated landlords: Moody's
Northpoint City, part of Frasers Centrepoint Trust’s portfolio. (Photo: Frasers Property Singapore)
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Stronger rental income growth is on the cards for most of the publicly rated real estate companies in Asia Pacific (Apac), including Singapore Reits, in 2026, according to analysts at Moody’s Ratings.
In Singapore, retail, office, and industrial properties of five rated landlords could see mild increases of up to 3%, the credit rating agency wrote in a March 11 sector report.
Lingering geopolitical tensions and further interest rate hikes in Australia and Japan remain key risks for the region. Meanwhile, oversupply will continue to weigh on office commercial real estate in China and Hong Kong, although leasing demand is improving in the latter.
Continuing economic growth and scarce supply will strengthen landlords’ negotiating power, while the effects of last year’s interest rate reductions will improve consumption and business activity. Improving property market fundamentals will allow some of the Apac region’s rated Reits and real estate operating companies (REOCs) to pursue growth initiatives.
Moody’s foresees stronger rental income growth in most geographies in 2026:
Note: Rental income projections are for rated companies, except in China, where the estimate is for the broader market. Excludes Indonesia’s Pakuwon Jati. Source: Moody's Ratings forecasts.
The 44 publicly rated Reits and REOCs in Apac include: CapitaLand Ascendas Reit, CapitaLand Integrated Commercial Trust, CK Asset, Frasers Centrepoint Trust, Hongkong Land, Link Reit, Mapletree Pan Asia Commercial Trust, Mitsubishi Estate, Mitsui Fudosan, Pakuwon Jati, Scentre Group, and Swire Properties.
Rental income to grow for most rated companies
Projected rental income growth will be strongest overall in Australia and Japan, across rated retail, office and industrial Reits and REOCs in the region, Moody’s noted.
In Singapore, office rental income is expected to grow by 1-3% over the next 12 months.
With steady demand for premium and well-located office assets — particularly from financial and professional services and technological firms — and limited development completions in 2026, Singapore’s office rental growth and vacancy rates will continue to improve, especially in core CBD areas.
Retail assets in Singapore could post slight rental growth amid stronger consumption, increased tourist spending, and tighter property supply as compared with recent periods.
Expecting retail rents in the city-state to inch up by 1-2%, the analysts said that consumer sentiment and spending have improved with lower interest rates and inflation. Tourist arrivals have also increased, driving demand for retail space.
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Retail sales have improved to above pre-pandemic levels, except in Hong Kong:
Sources: Australian Bureau of Statistics, Hong Kong's Census and Statistics Department, Department of Statistics of Singapore, Ministry of Economy, Trade and Industry of Japan, and China's National Bureau of Statistics; Moody’s Ratings.
Industrial properties in Singapore may see steady leasing demand from the manufacturing and industrial sectors due to the growth in third-party logistics and e-commerce, a recovery in manufacturing, and supply-chain diversification.
Furthermore, the supply of new industrial space will ease significantly this year. New warehouse supply over the next three years will be 39% below the average of the last decade, according to CBRE estimates.
Rental income growth for industrial assets in Singapore could therefore come in at 0-2% in 2026, according to Moody’s.
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