And it’s not getting any better soon, analysts say.
With the bleak manufacturing landscape in the city-state, headlined by declining outputs of transport engineering and general manufacturing clusters, industrial rents in Singapore are dropping.
According to a report by JLL, the multiple-user factory segment fell by 3.3% in 4Q15, recording its steepest decline in five years.
“At the same time, the traditionally stronger Single-User Factory segment registered its second quarter of decline at 0.8 per cent since the availability of the series in 2011, emphasising the impact of the weak global demand on the local industrial market,” JLL said.
Meanwhile, the light at the end of the tunnel is nowhere to be seen for industrial rents in Singapore, as the global demand remains weak with little improvement expected for larger economies including China and Europe.
“We expect rents among the different industrial types to continue softening by up to 5.0 per cent y-o-y in 2016,” JLL added.
“Through the continued efforts by the government to pursue better use of space, some developments vacated by traditional industrialists have undergone adaptive re-use to accommodate higher value added industries, supporting downstream clusters such as construction, carpentry, design, project management etc,” Chua Yang Liang, JLL’s head of research at South East Asia and Singapore said.
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