Industrial leasing activity in Singapore experienced a significant uptick in the second quarter of 2025, according to Savills Singapore. The total leasing volume increased by 7.6% year-on-year, reaching 3,360 tenancies, marking the highest quarterly total since Q3 2021. This surge is attributed to occupiers prioritising operational flexibility, cost containment, and spatial efficiency amidst ongoing macroeconomic challenges and policy uncertainties.
Alan Cheong, Executive Director of Research and Consultancy at Savills Singapore, noted, “Global supply chains are in a state of flux. Until tariff policy from major economies like the US is clarified, many firms are taking a wait-and-see approach. Yet essential industrial operations cannot pause indefinitely.”
The report highlighted varied trends within the industrial property market. Prime multiple-user factory rents saw a decline of 1.4% quarter-on-quarter as firms consolidated space or renewed leases at more competitive terms. Conversely, prime warehouse and logistics rents increased by 4.3% quarter-on-quarter, driven by sustained demand from e-commerce, manufacturing, and third-party logistics operators. High-spec industrial rents also rose by 2.1% quarter-on-quarter, reflecting demand in areas with modern infrastructure.
Ashley Swan, Executive Director of Commercial and Industrial at Savills Singapore, observed, “Activity across most of Singapore’s industrial sectors has picked up, with occupiers actively surveying the market for opportunities. Notably, we’re seeing interest from new entrants looking to establish a presence in Singapore.”
Looking forward, Savills Singapore anticipates that renewals and strategic relocations will remain prevalent throughout 2025 as firms seek to maintain operational agility and hedge against trade volatility. The focus on flexibility and optionality is expected to continue, with occupiers increasingly requesting shorter lease tenures and early termination clauses to mitigate future risks.
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