Industrial demand in Singapore has become increasingly selective, according to Savills’ Q3 2026 briefing. Whilst factory and warehouse leasing volumes have seen a slight uptick, the overall occupied space has declined as businesses remain cautious amidst rising operating costs.
The report highlights that factory vacancy rates have increased due to weaker absorption, whereas warehouse vacancy has eased following a reduction in stock. Despite JTC’s rental indices showing an upward trend, Savills notes a decline in prime factory and warehouse rents as occupiers become more cost-conscious.
Strata industrial prices have shown resilience, supported by demand for more affordable, shorter-tenure assets, even as sales activity softens. Meanwhile, prime business park and high-spec industrial rents have outperformed, driven by a continued flight to quality, though older business park clusters face higher vacancy rates.
Savills anticipates that limited new supply will keep JTC’s rental indices stable throughout 2026. However, performance is expected to diverge based on asset quality, with prime locations likely to fare better. The report underscores the importance of asset quality in navigating the current industrial landscape.
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