Business park spot rents predicted to moderate by 3% in 2014

Landlords stuck under pressure.

According to DBS, notwithstanding that new supply is supported by relatively high pre-commitment levels in the immediate term, it believes that landlords are still likely to face pressure, given that high sector-wide vacancy is close to 20%.

DBS noted that landlords of older business park properties are likely to feel the pressure due to the competition from newer buildings, which means that some might have to invest in capex or reduce rents to attract tenants. Hence, it expects asking rentals to soften by 3%.

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