The JTC Quarterly Market Report for Q1 2025 has revealed a contraction in single-user factory stock in Singapore for the first time since 2018.
According to Dr Chua Yang Liang, Head of Research & Consultancy for Southeast Asia at JLL Singapore, this decline is part of a broader structural shift in the industrial landscape towards higher productivity and value-added sectors.
The rental index for all industrial properties maintained a growth of 0.5% quarter-on-quarter, but the annual growth slowed to 2.3% from 3.5% in Q4 2024.
The single-user factory segment experienced a significant decline of 4.3% quarter-on-quarter, erasing most of the rental gains from the previous quarter. This contraction reflects a broader trend of decreasing manufacturing output, which has been falling since December 2024.
The Economic Development Board’s (EDB) Monthly Manufacturing Performance report noted a 7.5% month-on-month decrease in manufacturing output in February 2025.
Despite these challenges, business sentiment among manufacturers remains cautiously optimistic. A net weighted balance of 16% of manufacturing firms expect a more positive business outlook for the first half of 2025, compared to 10% previously.
Dr Chua suggests that industrial rents may stabilise in the latter half of the year, provided global trade conditions do not deteriorate further due to tariff impositions.
Globally, the JP Morgan Global PMI report indicates a continuation of economic expansion, albeit at a subdued pace compared to 2024. Whilst services have shown improvement, manufacturing remains sluggish, with business confidence affected by potential tariff impacts.
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