Mixed outlook for industrial property market: Colliers


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06/02/2015

Colliers International said that companies are expected to remain cost-sensitive and may take longer to evaluate their business space needs.

SINGAPORE: Singapore’s industrial property market will continue to have a mixed outlook for this year, according to a report released by Colliers International on Monday (Jan 12).

The real estate services firm said that companies are expected to remain cost-sensitive and may take longer to evaluate their business space needs. This is partly due to the fragile global economic outlook and lingering risks from plunging oil prices.

In terms of sales, Colliers said transaction activity in strata-titled industrial category is likely to remain subdued in 2015. Coupled with the continued effects of total debt servicing ratio requirements, industrial property prices are expected to be down overall.

Nonetheless, demand for specialised and niche developments such as food factories, which are limited in supply, is expected to remain healthy. While rents for multi-tenant conventional industrial space may ease further because of mounting supply pressures, rents for properties with higher building specifications – such as those located within the business parks – could see some upside potential because of tighter supply.

In particular, Colliers said tenants with large space requirements of 100,000sqf and above, and who need the space immediately, may face challenges in finding available options.

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