Savills: High-spec industrial rents at the highest point since 2012

A Savills Singapore study discovered that the average regular monthly rent for high-spec commercial area was $3.69 psf in 3Q2022. This is a 1.1% quarterly increase and matches the documented q-o-q progress in 2Q2022. The rental price has climbed considering that Savills started collecting this data in 2012.

Next year, industrial leas are anticipated to increase, coupled with the increase in service charges, and the upward momentum in rentals will certainly continue as property managers hand down higher business costs to tenants, claims Cheong.

Canninghill Piers River Valley

The pick-up in high-spec commercial leas is in line with the general rise viewed throughout the commercial industry, with storage facility and logistics properties reporting a quarterly increase of 1.4% in 2Q2022 to 2.8% in 3Q2022, where regular rental fees stood at $1.51 psf.

“Need for commercial rooms, especially modern high spec storehouses, in addition to high-spec commercial and establishment parks with great connectivity and amenities will certainly continue to be underpinned by growth markets such as the logistics, food, precision technological innovation and even biomedical markets,” claims Alan Cheong, executive director of research at Savills.

The working as a consultant projects leas of top storage facility along with logistics properties will increase 2% to 5% y-o-y for each year in 2022 and even 2023. Meanwhile, multi-user manufacturing facilities may reduce from 10% to 12% y-o-y rise in 2022 to 4% to 6% in 2023.

Based upon a basket of commercial estates tracked by Savills, the prices for 60-year leasehold and freehold commercial properties rose by 1.2% q-o-q to $463 psf plus $758 psf, respectively. “Besides the more lasting tenure as well as nature of property leases, the increase in rates was driven by the strong cost growth for food factory real estates,” the Savills record includes.