Singapore’s industrial sector demonstrated robust growth in the second quarter of 2026, with the manufacturing sector expanding by 12.2% year-on-year, according to the latest JTC Industrial Statistics. This growth was largely fuelled by strong global demand for AI-related products, particularly computer chips, despite ongoing geopolitical tensions in the Middle East. The Purchasing Manager’s Index (PMI) for June 2026 stood at 51.3, indicating expansion, with the electronics PMI outperforming at 52.2.
The industrial price and rental indices both saw modest quarterly increases of 0.6% and 0.5%, respectively. However, industrial sales transactions decreased, with big-ticket deals over S$10m dropping from 39 in Q1 to 16 in Q2. Smaller transactions remained stable, suggesting continued demand from owner-occupiers seeking business continuity.
Tridiana Ong, Head of Occupier Strategy and Solutions at Knight Frank Singapore, noted that leasing demand is expected to remain strong as AI and automation adoption grows. “Well-connected, amenity-rich business park buildings such as Galaxis are backfilling spaces from larger former occupiers,” Ong said.
Investment in advanced manufacturing and AI infrastructure is anticipated to remain robust, with Singapore’s fixed asset investment commitments rising 40.9% year-on-year in Q1 2026. The electronics sector saw a significant surge in commitments, reaching S$2.2b. Knight Frank projects industrial property prices to grow between 3% and 5% for the year, driven by resilient demand and Singapore’s status as a strategic hub.
