Industrial prices to grow between 5%-7% in 2022 amidst growing demand

Macroeconomic uncertainties are pushing industrialists to diversify locations.

With industrial assets seeing more demand, rental prices are likely to grow by 5% to 7% in 2022, according to Colliers. 

In a report, Colliers said macroeconomic uncertainties have prompted "industrialists to fortify their supply chains by diversifying locations and stockpiling." 

Colliers, however, warned that these uncertainties can also dampen business sentiments in the industrial sector.

"It has also led them to be more cautious about their expansion plans," said the expert. 

On the flip side, Colliers said demand for industrial assets had already caught up with supply in Q2.

During the quarter, total net absorption came to 4.30 mil sf, whilst 3.46 mil sf of industrial space came onstream.

According to the expert, interest in industrial assets is growing due to their "higher yields and limited availability.

"In the long term, demand for industrial space will still, be driven by tailwinds such as Singapore’s increasing focus on higher-value manufacturing and biomedical sectors," added Colliers.