JTC Quarterly Market Report Q&A: A Comprehensive Guide

Alliance Facilities Management Pte Ltd: Your Trusted Partner in Singapore’s Industrial Property Market

• Established in 2011, Alliance Facilities Management Pte Ltd has earned a solid reputation for guiding both multinational corporations and small-to-medium enterprises through Singapore’s complex industrial property market—especially when it comes to JTC-related services. From JTC Lease Assignments and Lease Renewals to Anchor Tenant Applications and Industrial Land Tenders, our team offers end-to-end support to help your business secure approvals under stringent JTC guidelines.

Over a Decade of Proven Results

• Backed by over 100 successful JTC submissions totalling more than SGD 1 billion in value, our track record speaks for itself. We focus on delivering real results. That’s why we charge fees only upon successful approval, reflecting our unwavering confidence and commitment to your success. Our experts meticulously craft comprehensive business plan justifications, present fixed asset investments and redevelopment plans, and demonstrate job creation potential—all to reinforce your project’s economic value and win regulatory approval.

Comprehensive Facilities & Construction Management

• Beyond specialized JTC services, Alliance Facilities Management Pte Ltd provides holistic facilities and construction management solutions. Whether we’re optimizing your current facilities or overseeing new developments, our attention to detail and proactive approach ensure efficient execution while upholding the highest standards of quality and compliance.

Client-Centric Approach & Diverse Portfolio

• Our client-focused philosophy is at the heart of everything we do. We’re proud to serve a wide array of industries and business sizes, including listed equity firms (19%), MNCs (16%), and SMEs (65%). Our industry breakdown underscores our versatility:

Construction / Engineering: 23%

General Manufacturing: 13%

Food Production: 12%

Marine / Shipbuilding: 12%

Distribution / Warehousing: 11%

Chemical & Gas: 8%

Precision Engineering / Cleanroom: 6%

Logistics & Transportation: 6%

Waste Management / Automobile: 5%

Retail / Distribution: 4%

By aligning our expertise with the specific challenges of these industries, we deliver tailored solutions that drive efficiency, growth, and compliance.

Your Path to Success

At Alliance Facilities Management Pte Ltd, we believe that navigating Singapore’s industrial property market should be a strategic advantage, not a hurdle. Trust our decade of expertise, proven methodology, and results-driven fee structure to safeguard your interests, ensure a seamless approval process, and enhance your operational efficiency.

Contact Us today to discuss how we can support your business goals and help you thrive in Singapore’s industrial landscape.

Stay informed about the latest JTC Industrial Land Lease policy changes that aim to provide greater flexibility, certainty, and support for businesses. Below is a comprehensive overview of the enhancements and their implementation timelines.

1. Additional Three-Year Lease Tenure for New Greenfield Industrial Land Allocations

• Key Update: JTC will offer an additional three years of lease (with payable land rent/premium) for all new greenfield allocations requiring new building development. This ensures businesses can enjoy the full 20- or 30-year intended lease term.

• Why It Matters: Helps businesses cover building and development periods without sacrificing lease duration. Provides more predictability in operational and capital planning.

• Implementation Timeline: Immediate effect.

2. Introduction of the Flexible Lease Extension Initiative (FLEXI)

• Key Update: Eligible land lessees on 20-year JTC leases can extend their leases in up to two tranches of five years each. Businesses must demonstrate strong economic outcomes and commit to new plant and machinery investments to qualify.

• Why It Matters: Allows businesses to extend beyond the original 20-year term by up to an additional 10 years. Encourages sustained economic growth and investment within Singapore’s industrial landscape.

• Implementation Timeline: Targeted for 2H2025.

3. Earlier Lease Renewal Applications

• Key Update: JTC will bring forward the lease renewal application window from six years to ten years before the prevailing lease expiry.

• Why It Matters: Provides businesses with greater certainty about lease continuation well in advance. Facilitates long-term strategic planning, including expansion and technology upgrades.

• Implementation Timeline: Targeted for 2H2025.

4. Broader Recognition of Auditable Investments in Innovation and R&D

• Key Update: Beyond traditional Plant and Machinery (P&M) investments, JTC will recognize auditable investments in innovation, R&D, digital transformation, and Intellectual Property (IP) creation. This expanded definition aligns with evolving business models and supports value creation and productivity.

• Why It Matters: Encourages companies to invest in advanced technologies and IP, driving competitiveness and growth. Acknowledges modern forms of capital investments critical to innovation-driven enterprises.

• Implementation Timeline: Targeted for 2H2025.

Conclusion

These JTC Industrial Land Lease policy enhancements are designed to provide businesses with:

• Extended lease security for better long-term planning.

• Greater flexibility to adapt and grow.

• Incentives for innovation through recognition of diverse forms of investment.

For more information or to discuss how these changes can benefit your business, contact us or visit our website. Stay ahead with the latest updates and make the most of your industrial land lease tenure under JTC’s enhanced framework.

Thank you for your continued trust and partnership with Alliance Facilities Management Pte Ltd.

Answer: 

• As of the fourth quarter of 2024, the total industrial space in Singapore reached 53.3 million square meters. This figure represents a steady growth trajectory in Singapore's industrial real estate sector, driven by a carefully managed supply pipeline. Over the past year, new developments have incrementally added to the total stock, aligning with the nation’s industrial development roadmap, which prioritizes sectors such as advanced manufacturing, logistics, and precision engineering.

• This extensive industrial space includes multiple property segments: Single-User Factories, Multiple-User Factories, Warehouses, and Business Parks. The ongoing expansion reflects Singapore’s strategic role as a global trade hub, catering to the needs of high-value industries and supporting the increasing demand from the logistics and e-commerce sectors.

Answer: 

• The overall occupancy rate for industrial properties in Singapore remained stable at 89.0% in 4Q 2024. This stability indicates a well-balanced market, where supply and demand are closely aligned. The occupancy rate also underscores the resilience of Singapore’s industrial property market, even amidst global economic uncertainties.

• Such consistency is attributed to strong underlying demand from key industries, particularly logistics, electronics manufacturing, and advanced manufacturing, which continue to expand operations in Singapore due to its strategic geographical location and world-class infrastructure.

Answer: 

• The year-on-year occupancy rate for industrial properties remained unchanged at 89.0%, demonstrating the robustness and maturity of Singapore’s industrial property market. Despite the introduction of approximately 0.8 million square meters of new supply over the year, the market has absorbed this additional space effectively, thanks to consistent demand across core industrial sectors.

• This stability reflects healthy tenant retention rates and the sustained attractiveness of Singapore as a business hub for global and regional operations. It also highlights the effectiveness of JTC’s policies in managing land supply and ensuring optimal allocation for industrial development.

Answer: 

Occupancy rate changes varied across different industrial property segments in 4Q 2024:

Single-User Factories:

• Occupancy increased by 0.3 percentage points, reaching 88.0%.

• The increase is attributed to strong demand from industries that require bespoke, large-scale facilities, such as heavy engineering and food production. These sectors continue to thrive as Singapore promotes its advanced manufacturing ecosystem.

Warehouses:

• Occupancy rose by 0.4 percentage points, reaching 91.5%.

• The rise in demand for warehouse space is primarily driven by the sustained growth of e-commerce, third-party logistics providers, and Singapore's strategic role as a regional distribution hub.

Multiple-User Factories:

• Occupancy declined by 0.6 percentage points, settling at 91.0%.

• This decline reflects tenant consolidations and relocations to newer facilities offering better efficiency and amenities. It also signals evolving tenant requirements, particularly among SMEs seeking cost-effective and adaptable spaces.

Business Parks:

• Occupancy dropped by 0.9 percentage points, reaching 77.9%.

• The lower occupancy rate for Business Parks indicates slower demand recovery in R&D-intensive sectors and technology-driven industries, which typically occupy such spaces. However, ongoing initiatives to enhance sustainability and collaboration within Business Parks are expected to rejuvenate demand.

Answer: 

The stability in occupancy rates across Singapore’s industrial property market can be attributed to several key factors:

Consistent Demand Across Core Industries:

• Industries such as logistics, precision engineering, electronics manufacturing, and food production continue to expand, driving sustained demand for industrial spaces. These sectors are integral to Singapore’s economy and align with its push toward high-value manufacturing and supply chain optimization.

Timely Completions of New Projects:

• New industrial developments have been introduced in a phased manner, ensuring that supply matches market demand. This avoids oversupply situations and allows new facilities to be absorbed steadily by tenants.

Strong E-Commerce Growth:

• The rapid growth of e-commerce has fueled demand for warehousing and logistics spaces. Singapore’s position as a regional distribution hub has amplified this effect, particularly for last-mile delivery and third-party logistics providers.

Proactive Government Policies:

• JTC’s strategic management of industrial land ensures that supply is released judiciously through programs like Government Land Sales (GLS). This ensures market equilibrium while meeting the needs of industrialists.

Infrastructure and Connectivity:

• Singapore’s world-class infrastructure, including advanced port facilities and logistics networks, makes it an attractive location for businesses seeking seamless regional and global connectivity.

Tenant Retention and Renewal:

• High retention rates among tenants, supported by competitive rental terms and high-quality facilities, have contributed to stable occupancy levels. Businesses value Singapore’s reliability as a base for their operations, especially in uncertain global economic conditions.

Answer: 

In 4Q 2024, industrial property prices experienced a 2.0% quarter-on-quarter increase and a 3.5% year-on-year rise. This marks a notable deceleration in growth compared to 2023, when prices were rising at a faster pace. The moderation in price growth is attributed to several factors:

Market Stabilization:

• The industrial property market is maturing, with a balance between new supply and demand preventing aggressive price hikes. This equilibrium reflects Singapore’s robust industrial planning and steady tenant demand.

Inflationary Pressures:

• Rising costs of construction materials and labor have influenced pricing trends, but developers are adopting cost-efficient practices to maintain affordability and encourage absorption.

Demand Shift Toward Modern Facilities:

• Tenants increasingly prefer newer, high-tech, and sustainable developments, which command a premium. This preference has sustained overall price growth despite challenges in older or less adaptable industrial properties.

Geographical and Segmental Variations:

• Locations such as the North Region have seen higher price growth due to improved infrastructure and proximity to Malaysia, while segments like Warehouses and Multiple-User Factories have outperformed other asset types due to e-commerce and SME demand.

Answer: 

Rental rates for industrial properties grew modestly by 0.5% quarter-on-quarter and 3.5% year-on-year, making 2024 the slowest year for rental growth since 2021. This reflects the stabilizing nature of the industrial property market, where rental prices are increasingly influenced by tenant affordability and operational cost constraints.

Slower Quarterly Growth:

• The 0.5% quarterly growth highlights a market where tenants are becoming more price-sensitive, especially SMEs managing tighter budgets amidst rising business costs.

Sectoral Support for Demand:

• Logistics and high-value manufacturing industries continue to drive demand for industrial space, particularly Warehouses and high-tech facilities, which maintain stable rental growth.

Tenant Behavior:

• Many tenants are opting for lease renewals instead of relocating to manage costs. This trend has moderated competition for new spaces, contributing to slower rental growth.

Regional Factors:

• Growth is concentrated in regions like the East Region, which benefits from proximity to Changi Airport and logistics hubs, sustaining demand for Warehouses and logistics facilities.

Answer: 

The Multiple-User Factory segment recorded the highest price growth at 4.9% year-on-year, outperforming other industrial property types. This robust growth is underpinned by several key factors:

Flexibility and Affordability:

• Multiple-User Factories offer versatile spaces suited for a wide range of industries, particularly SMEs that require smaller, more affordable units with flexible lease terms.

Tenant Demand from SMEs:

• The strong growth of Singapore’s SME sector has led to increased demand for Multiple-User Factory spaces, especially from businesses in light manufacturing, food production, and precision engineering.

Strategic Locations:

• Well-located developments in regions with strong infrastructure and connectivity, such as the North and West Regions, have commanded higher prices due to their attractiveness to tenants.

Increased Value of Modern Developments:

• Tenants prefer newer Multiple-User Factory developments with sustainable features and modern amenities, driving price growth in this segment.

Answer: 

The rental index for Warehouses increased by 0.9% quarter-on-quarter and 3.5% year-on-year, reflecting robust demand for logistics and storage facilities.

Demand from E-Commerce and Logistics:

• The sustained growth of e-commerce, both domestically and regionally, has driven higher demand for Warehouses, especially those equipped with modern features such as high ceiling heights, automation, and temperature-controlled zones.

Regional Trade Hub Status:

• Singapore’s position as a key logistics and trade hub in Southeast Asia supports consistent demand for warehousing spaces, with many multinational companies relying on Singapore as a distribution center.

Proximity to Key Infrastructure:

• Warehouses located near key infrastructure such as Changi Airport and Tuas Port continue to attract tenants willing to pay a premium for enhanced logistical efficiency.

Supply-Demand Balance:

• Despite new supply entering the market, the high absorption rate of warehouse space, especially in strategic regions like the East and West, has supported rental growth.

Answer: 

The long-term outlook for industrial rental prices in Singapore remains stable, supported by a balance between supply and demand. Here are the key factors shaping the future trajectory:

Balanced Supply Pipeline:

• With approximately 1.2 million square meters of new industrial space expected to be completed in 2025, the market is anticipated to maintain equilibrium. Strategic releases through JTC’s Government Land Sales (GLS) program will ensure that supply growth aligns with demand.

Sustained Demand from Growth Industries:

• High-value manufacturing, logistics, and advanced sectors such as robotics and biotechnology will continue to drive demand for specialized industrial spaces, underpinning steady rental rates.

Shift Toward Sustainable Developments:

• Tenants are increasingly seeking green-certified spaces that align with corporate sustainability goals. Properties with energy-efficient designs and smart technologies are likely to command premium rents.

Moderated Rental Growth:

• While stable, rental growth is expected to remain moderate, with annual increases in the range of 3%–4%, as tenants remain price-sensitive and cautious about expanding their operations amidst global economic uncertainties.

Geographical Considerations:

• Prime locations in the East and Central Regions are likely to see stronger rental growth due to proximity to key transport infrastructure, while the North and West Regions may benefit from new developments and improving connectivity.

Answer: 

The occupancy rate for Multiple-User Factories in 4Q 2024 decreased to 91.0%, marking a 0.6 percentage point decline from the previous quarter. Despite the marginal decrease, this segment continues to maintain strong occupancy levels due to its inherent flexibility and suitability for a diverse range of industries.

Key Drivers of Demand:

• Flexibility: Multiple-User Factories are designed to cater to SMEs and light manufacturing companies, offering adaptable layouts and shorter lease terms.

• Cost-Effectiveness: They remain a cost-efficient option for businesses requiring smaller operational footprints without the capital expenditure of building custom facilities.

• High Tenant Turnover: The decline reflects temporary tenant churn, as some businesses consolidated operations or moved to newer facilities with better amenities.

Challenges in 4Q 2024:

• Competition from New Developments: Tenants are increasingly attracted to newer facilities with modern features, causing slight occupancy fluctuations in older developments.

• Sector-Specific Dynamics: SMEs in sectors like precision engineering and manufacturing faced cost pressures, which may have limited their capacity to expand or maintain current leasing arrangements.

Regional Performance:

• Developments in the North Region continued to perform well due to infrastructure improvements, while older facilities in the West Region faced higher vacancy rates as tenants sought more modern alternatives.

Answer: 

Single-User Factories achieved an occupancy rate of 88.0% in 4Q 2024, a 0.3 percentage point increase compared to the previous quarter. This rise underscores the importance of such facilities for industries requiring highly customized spaces and larger operational capacities.

Demand Drivers:

• Customizability: Single-User Factories are ideal for businesses in heavy engineering, advanced manufacturing, and logistics requiring tailored layouts and specifications.

• Sectoral Growth: Industries such as food manufacturing and petrochemicals have driven demand, particularly for factories with specialized equipment and infrastructure.

Key Challenges:

• Operational Costs: Rising energy and maintenance costs have made it challenging for some tenants to justify large single-user spaces, especially if operations can be consolidated.

• New Supply Absorption: While demand is consistent, the time taken to absorb new purpose-built facilities can temporarily impact occupancy rates.

Future Trends:

The gradual introduction of more energy-efficient and smart-enabled Single-User Factories is expected to attract high-value industries seeking modern infrastructure to support Industry 4.0 initiatives.

Answer: 

Business Parks recorded a lower occupancy rate of 77.9%, representing a 0.9 percentage point decline compared to the previous quarter. This reduction reflects slower tenant take-up in sectors such as R&D, technology, and professional services.

Factors Behind Decline:

• Slower Recovery in R&D-Intensive Sectors: Business Parks, which traditionally cater to industries like biotechnology and information technology, have faced headwinds as these sectors recover unevenly.

• Tenant Expectations: Increasingly, tenants expect collaborative workspaces, integrated amenities, and sustainability certifications, which older Business Parks may lack.

Emerging Opportunities:

• Business Parks are evolving to cater to high-value industries with features like green building certifications, collaborative spaces, and proximity to transport and amenities.

• Developments such as those in the Central and West Regions are incorporating smart infrastructure to attract tenants focusing on innovation and R&D.

Future Outlook:

• The government’s emphasis on growing knowledge-based industries and fostering innovation clusters is expected to rejuvenate demand for Business Parks over the medium to long term.

Answer: 

Warehouses achieved an impressive 91.5% occupancy rate in 4Q 2024, reflecting a 0.4 percentage point increase from the previous quarter. This growth highlights the continued strength of Singapore’s logistics sector and its role as a regional trade hub.

E-Commerce and Third-Party Logistics (3PLs):

• The rapid growth of e-commerce, driven by both local and regional consumer demand, has led to an increase in warehouse leasing activity. Warehouses are increasingly used for last-mile delivery hubs and regional distribution centers.

Modernization of Warehousing Facilities:

• Tenants are drawn to modern warehouses featuring advanced logistics technologies, such as automated storage systems, high clear heights, and temperature-controlled environments.

Key Demand Areas:

• Warehouses in the East Region (close to Changi Airport) and West Region (near Tuas Port and Jurong Industrial Estate) are particularly in demand due to their proximity to major transport and logistics infrastructure.

Long-Term Sustainability:

• With Singapore continuing to position itself as a logistics leader in Southeast Asia, the demand for warehousing space is expected to remain robust, particularly for modern, sustainable developments.

Answer: 

The stock of Single-User Factory space in 4Q 2024 totaled 26.5 million sqm, making it the largest segment within Singapore’s industrial property market. These spaces cater predominantly to larger tenants with specific operational requirements, including those in heavy industries, petrochemicals, and large-scale logistics.

Segment Characteristics:

• Single-User Factories are typically purpose-built and cater to businesses requiring extensive floor space, custom designs, and specialized facilities.

• This segment is critical to Singapore’s advanced manufacturing and industrial strategy, providing the infrastructure necessary for industries driving GDP growth.

Occupancy Resilience:

• The increase in occupancy to 88.0% suggests stable demand from anchor tenants in critical sectors. However, tenant churn in older properties or those requiring significant retrofitting may contribute to temporary vacancies.

Emerging Trends:

• New Single-User Factories are incorporating green features, such as solar panels and energy-efficient systems, to align with Singapore’s sustainability agenda and reduce operational costs for tenants.

Answer: 

Demand for industrial space in Singapore has remained stable throughout 2024, driven by growth in key sectors such as manufacturing, logistics, and e-commerce. These sectors form the backbone of Singapore’s industrial property market and continue to expand due to structural shifts and technological advancements.

Manufacturing Resilience:

• Advanced manufacturing, including precision engineering and semiconductor production, has been a critical driver of demand. The global focus on supply chain resilience has solidified Singapore’s role as a reliable manufacturing hub in the region.

Logistics Expansion:

• The logistics sector has grown significantly, underpinned by Singapore’s strategic location as a regional trade and distribution hub. Businesses engaged in third-party logistics (3PLs) and last-mile delivery services continue to seek warehouse and logistics space.

E-Commerce Growth:

• E-commerce remains a key driver, with demand for warehousing and fulfillment centers growing in tandem with online shopping trends across Southeast Asia. Companies are expanding their storage and distribution networks to cater to rising consumer expectations for fast delivery.

Emerging Demand from High-Tech Industries:

• High-tech industries, including robotics, biotechnology, and renewable energy, are generating incremental demand for specialized industrial spaces, such as cleanrooms and R&D facilities.

Adaptation to Sustainability Requirements:

• As sustainability becomes a priority, tenants are actively seeking industrial properties with energy-efficient designs, green certifications, and smart technology, further shaping demand dynamics.

Answer: 

Approximately 1.2 million square meters of new industrial space is expected to be completed in 2025. This includes developments across multiple segments, such as Single-User Factories, Multiple-User Factories, Warehouses, and Business Parks.

Segmental Contributions:

• A significant portion of the new supply will cater to Warehouses and Multiple-User Factories, reflecting the ongoing demand from logistics and SMEs.

• Business Parks and specialized facilities, such as food-related industrial spaces, will also form a substantial part of the upcoming supply pipeline.

Regional Distribution:

• The new supply will likely focus on the West Region and North Region, where significant infrastructure projects, such as Tuas Port and the Johor Bahru–Singapore RTS Link, are set to enhance connectivity and support industrial growth.

Alignment with Market Needs:

• The new supply is strategically aligned with market demands, focusing on modern, high-tech, and sustainable developments that cater to evolving tenant expectations.

Answer: 

The projected 1.2 million sqm of new supply in 2025 exceeds the three-year historical annual average of 0.9 million sqm. This marks a significant increase in development activity, signaling confidence in the long-term growth of Singapore’s industrial property market.

Reasons for Increased Supply:

• Pent-Up Demand: Post-pandemic recovery and the expansion of e-commerce and advanced manufacturing sectors have created a need for additional industrial space.

• Government Support: JTC and the government have actively released land and encouraged developments to meet the rising demand for modern industrial facilities.

• Infrastructure Investments: Major projects such as Tuas Port and Changi East Industrial Zone have spurred developers to ramp up supply in strategic areas.

Market Preparedness:

• Unlike speculative supply spikes in other markets, Singapore’s new supply is carefully managed to align with demand, minimizing risks of oversupply and ensuring high absorption rates.

Comparison with Future Supply Trends:

• Beyond 2025, an estimated 1.1–1.3 million sqm of industrial space is expected annually in 2026 and 2027, maintaining a steady pipeline to accommodate long-term demand.

Answer: 

While the industrial property market in Singapore has shown resilience, it is not without challenges. Key headwinds faced in 2024 include:

Slower Rental Growth:

• Rental growth in 2024 has been moderate at 3.5% year-on-year, reflecting a maturing market. Tenants are increasingly price-sensitive, especially SMEs grappling with rising operational costs and global uncertainties.

Cautious Developer Sentiment:

• Developers exhibited caution in Government Land Sales (GLS) tenders, with some sites receiving low bids or no bids at all. Rising construction costs, higher interest rates, and economic uncertainties have contributed to this conservative approach.

Sustainability Transition:

• Many older industrial properties face challenges in meeting tenants’ growing sustainability requirements, such as green building certifications and energy-efficient infrastructure.

Global Economic Uncertainty:

• Ongoing global challenges, including inflationary pressures, geopolitical tensions, and supply chain disruptions, have made businesses cautious about expansion, impacting short-term leasing activity.

Sector-Specific Volatility:

• While logistics and manufacturing remain strong, other sectors, such as technology and R&D, have seen uneven growth, affecting occupancy in segments like Business Parks.

Answer: 

The long-term outlook for Singapore’s industrial property market remains positive, with stable growth projected due to balanced supply-demand dynamics and the country’s strategic position as a regional business and logistics hub.

Stable Growth in Prices and Rentals:

• Prices and rentals are expected to increase steadily, with annual growth rates in the range of 3%–5%, supported by robust demand from logistics, manufacturing, and e-commerce sectors.

Sustainability-Driven Development:

• The industrial property market is increasingly focused on sustainability, with new developments incorporating energy-efficient designs, green certifications, and renewable energy systems. These features will attract high-quality tenants and command premium rents.

Innovation and Industry 4.0:

• The adoption of smart technologies, automation, and Industry 4.0 practices is expected to drive demand for high-tech industrial spaces, including cleanrooms, robotics-ready factories, and R&D facilities.

Continued Government Support:

• The government’s proactive management of industrial land supply through JTC ensures a consistent pipeline of modern facilities tailored to market needs. Initiatives such as sustainability incentives and infrastructure investments further enhance market attractiveness.

Regional Competitiveness:

• Singapore’s connectivity to global and regional markets, coupled with its reputation for stability and efficiency, positions it as a preferred destination for multinational corporations seeking regional headquarters and logistics hubs.

Key Growth Regions:

• The West Region will continue to lead in heavy manufacturing and logistics, while the East Region will see sustained demand for warehousing due to its proximity to Changi Airport. The North Region is emerging as a logistics hub, bolstered by improved infrastructure and cross-border connectivity.

Answer: 

During the fourth quarter of 2024, three IGLS sites were tendered, comprising:

• One single-user site located at Tuas Bay Drive, designed to cater to industries requiring dedicated large-scale facilities.

• Two multiple-user sites, strategically located at Lok Yang Way and Kallang Way, aimed at supporting SMEs, light industries, and specialized sectors.

These tenders are part of JTC’s ongoing efforts to manage Singapore’s industrial land supply, ensuring alignment with demand while supporting growth in critical sectors like logistics, food manufacturing, and advanced manufacturing.

Answer: 

Of the three sites tendered:

Tuas Bay Drive (Single-User Site):

• This site received no bids, signaling limited demand for large single-user sites in less central locations during this tender period. Developers’ cautious sentiment and cost considerations likely contributed to the lack of interest.

Lok Yang Way (Multiple-User Site):

• This site was successfully awarded to the top bidder at $1,507 per square meter per plot ratio (psm ppr). The site’s location in the West Region, close to established industrial estates and key logistics nodes, contributed to its attractiveness.

Kallang Way (Multiple-User Site for Food Development):

• Kallang Way received four bids and was awarded at a top bid of $3,229 psm ppr, reflecting strong demand for food manufacturing facilities. Its location in the Central Region makes it highly desirable for companies focused on food production and distribution, given its proximity to urban centers and established infrastructure.

Answer: 

The Lok Yang Way site, a multiple-user site, received a top bid of $1,507 psm ppr. The competitive bidding for this site highlights its appeal due to its location in the Jurong Industrial Estate, a prime area in the West Region known for its connectivity to Tuas Port, Jurong Island, and major highways.

Site Characteristics:

• The site is well-suited for multiple-user developments, attracting SMEs and light industrial businesses seeking cost-effective spaces with excellent accessibility.

Market Context:

• Despite the relatively cautious bidding climate in 2024, the Lok Yang Way site drew interest due to its strategic location and potential to support industries like precision engineering, logistics, and small-scale manufacturing.

Answer: 

The Kallang Way site, specifically earmarked for food-related industrial development, received four bids and was awarded at a top bid of $3,229 psm ppr. This outcome underscores the strong demand for industrial spaces tailored to food production and distribution.

Factors Driving Interest:

• Strategic Location: Situated in the Central Region, the site provides excellent access to both residential areas and transportation networks, making it ideal for food manufacturers and suppliers catering to urban populations.

• Food Security Focus: Singapore’s emphasis on food security and the growth of the food manufacturing sector have increased demand for facilities that meet stringent hygiene and operational standards.

• Specialized Usage: The site’s designation for food-related industries makes it a niche but high-value offering, attracting serious bidders who see strong long-term potential in the food industry.

Implications for the Sector:

• The high bid reflects confidence in the food manufacturing sector, bolstered by government initiatives to enhance food resilience and expand Singapore’s role as a regional hub for high-value food production and exports.

Answer: 

Several IGLS sites, including the Tuas Bay Drive single-user site in 4Q 2024, were not awarded due to bids falling below reserve prices or the absence of bids. This outcome highlights cautious sentiment among developers in a challenging economic climate.

Cautious Developer Sentiment:

• Rising construction costs, higher financing costs due to increasing interest rates, and uncertainties in the global economy have made developers more conservative in their bidding strategies.

Location-Specific Considerations:

• The Tuas Bay Drive site’s relatively remote location may have deterred interest, as developers and tenants increasingly prioritize sites closer to established infrastructure and workforce populations.

Cost-Value Dynamics:

• Developers are evaluating sites more critically, ensuring that their investments align with projected tenant demand, potential rental yields, and long-term market trends. Sites with limited immediate demand or higher development costs may face reduced interest.

Preference for Multiple-User Sites:

• There is a growing shift in demand toward multiple-user developments, which cater to a broader range of tenants, including SMEs. This trend has made single-user sites less attractive unless they are located in prime areas with clear demand from specific industries.

Answer: 

In 4Q 2024, 65,500 square meters (sqm) of Ready-Built Facility (RBF) space was allocated, encompassing a mix of high-rise factory spaces and land-based facilities. This allocation reflects a strategic effort to meet demand from a broad spectrum of industries, particularly those requiring immediate operational readiness without incurring the time and capital costs of constructing customized facilities.

Breakdown of Allocations:

• High-Rise Factory Spaces: High-rise spaces accounted for a significant portion of allocations, offering efficient land utilization for industries with smaller operational footprints, such as precision engineering and electronics.

• Land-Based Factory Spaces: These spaces catered to industries requiring larger floor areas or specialized equipment, such as food manufacturing and logistics.

Alignment with Market Needs:

• RBF allocations in 4Q 2024 were tailored to support key growth sectors, including logistics, light manufacturing, and food production, which require scalable and versatile spaces.

Support for SMEs:

• RBFs play a vital role in supporting small and medium enterprises (SMEs), which often face constraints in accessing purpose-built industrial facilities. These pre-built spaces provide an affordable and flexible solution to accommodate their operational needs.

Answer: 

RBF returns totaled 60,000 sqm in 4Q 2024, with 45% of the returns resulting from natural lease expiries or company consolidations. The return of space is a natural part of the RBF lifecycle and provides opportunities for new businesses to access industrial properties.

Key Factors Behind Returns:

• Lease Expirations: A significant portion of the returned space came from leases reaching their natural end. These expiries create opportunities for JTC to reallocate space to businesses with evolving needs.

• Operational Consolidations: Some companies consolidated operations into fewer facilities to optimize costs and improve efficiency, leading to space returns.

Reallocation Efficiency:

• JTC actively reallocates returned spaces to maintain high utilization rates. This ensures that industrial land remains effectively used, supporting business growth and industrial activity.

Impact on Market Dynamics:

• The cyclical nature of space returns ensures that industrial property availability remains dynamic. This provides new entrants and expanding businesses with access to pre-built facilities without requiring significant capital investments.

Answer: 

Allocations were concentrated in newer developments, including 1 and 7 North Coast, TimMac @ Kranji, and Kranji Green. These developments are strategically located to cater to industries requiring modern facilities with excellent connectivity and infrastructure.

1 and 7 North Coast:

• Located in the North Region, these facilities provide advanced infrastructure tailored to SMEs and high-tech industries. Their proximity to Malaysia and improved regional connectivity makes them an attractive choice for logistics and precision engineering companies.

TimMac @ Kranji:

• This development is designed to support metal, machinery, and engineering industries, offering purpose-built spaces with high-specifications for light and medium manufacturing.

Kranji Green:

• Positioned as a sustainable industrial estate, Kranji Green integrates energy-efficient features and supports industries aligned with Singapore’s sustainability goals. Its focus on eco-friendly facilities has attracted tenants prioritizing environmental responsibility.

Strategic Importance of New Developments:

• These allocations underscore JTC’s commitment to modernizing industrial estates and providing tenants with cutting-edge facilities. New developments are increasingly designed to accommodate high-value industries and meet evolving operational requirements.

Answer: 

Ready-Built Facilities (RBFs) are a cornerstone of Singapore’s industrial property market, providing plug-and-play solutions that enable businesses to commence operations quickly and cost-effectively. They are particularly crucial for SMEs, which form the backbone of Singapore’s industrial ecosystem.

Immediate Operational Readiness:

• RBFs eliminate the lead time and high capital expenditure associated with constructing purpose-built facilities. This is especially advantageous for businesses looking to scale operations or enter the market rapidly.

Support for Diverse Industries:

• RBFs cater to a wide range of industries, including light manufacturing, logistics, food production, and precision engineering. Their flexibility ensures they can meet varied operational requirements.

Affordable and Flexible Leasing Options:

• RBFs provide affordable leasing options with flexible terms, making them accessible to start-ups and SMEs that might not have the resources to invest in larger, long-term facilities.

Contribution to Market Stability:

By ensuring a steady supply of ready-to-use industrial spaces, RBFs help stabilize the industrial property market, balancing demand and supply and reducing the risk of vacancy spikes.

Answer: 

The occupancy rate for RBFs in 4Q 2024 stood at 77.1%, reflecting stable demand across all segments. While slightly lower than other industrial segments like Warehouses or Multiple-User Factories, the RBF segment continues to attract tenants, particularly SMEs and businesses in transition.

Drivers of Stable Demand:

• Accessibility: RBFs’ immediate availability makes them attractive to businesses seeking quick operational setups.

• Strategic Locations: Many RBFs are located in established industrial estates with strong transport connectivity, further boosting their appeal.

Occupancy Challenges:

• Older Developments: Some older RBF developments face challenges in attracting tenants due to outdated facilities or limited adaptability to modern industrial needs.

• Sector-Specific Dynamics: Certain sectors, such as traditional manufacturing, may face slower growth, impacting demand for specific RBF types.

Future Trends in Occupancy:

o Occupancy rates for RBFs are expected to improve as newer, high-specification developments like Kranji Green come online. These modern facilities, tailored to high-value industries, will likely attract tenants seeking enhanced features and sustainability credentials.

Answer: 

The North Region recorded the highest price growth for Multiple-User Factories in 4Q 2024, with a 2.7% increase in the price index. This robust growth underscores the strategic importance of the region, driven by its accessibility, ongoing infrastructure improvements, and its proximity to Malaysia, which enhances its attractiveness for cross-border trade and manufacturing.

Drivers of Price Growth:

• Cross-Border Logistics: The North Region benefits from its proximity to the Johor Bahru–Singapore Causeway and the upcoming RTS Link, making it an ideal hub for cross-border logistics operations.

• Infrastructure Investments: Significant investments in transport and industrial infrastructure, including road improvements and industrial park upgrades, have increased the region's desirability for businesses.

• Demand from SMEs: Multiple-User Factories cater to SMEs, which are a growing segment in the North Region, particularly in light manufacturing, precision engineering, and warehousing.

Key Developments:

• Newer industrial parks and high-tech facilities in the region are attracting businesses seeking modern, sustainable spaces. These developments are commanding premium prices due to their enhanced features.

Future Growth Potential:

• Continued infrastructure upgrades and policy initiatives to promote cross-border trade are expected to sustain demand and drive further price growth in the North Region.

Answer: 

The rental index for the Central Region rose modestly by 0.2% in 4Q 2024. This growth reflects stable demand for prime industrial spaces, particularly in areas with excellent connectivity and proximity to business districts.

Demand Drivers:

• Proximity to Urban Centers: The Central Region offers unparalleled access to Singapore’s central business district (CBD) and residential hubs, making it highly attractive for high-value industries such as technology, R&D, and food manufacturing.

• Premium Industrial Spaces: Industrial properties in the Central Region are typically modern, high-specification facilities that cater to businesses requiring state-of-the-art infrastructure and amenities.

Tenant Preferences:

• Companies prioritizing accessibility to talent, clients, and logistics networks continue to drive demand for Central Region properties, ensuring rental stability even in a competitive market.

Future Outlook:

• Rental growth in the Central Region is expected to remain steady, supported by limited new supply and sustained demand for high-quality industrial spaces.

Answer: 

The West Region saw a 1.8% decline in its industrial property price index in 4Q 2024, reflecting softening demand for certain segments of industrial properties, particularly older facilities that lack modern features.

Contributing Factors to Decline:

• Tenant Consolidation: Larger businesses operating in the West Region have consolidated operations into fewer facilities, leading to reduced demand for older or less efficient industrial properties.

• Shift Toward Modern Spaces: Tenants are increasingly favoring newer, high-specification developments, leaving older industrial estates underutilized.

• Ample Supply: The West Region continues to hold the largest share of Singapore’s industrial land, and the ongoing introduction of new developments has led to competitive pricing.

Opportunities in the Region:

• Despite the price dip, the West Region remains a key hub for heavy industries, petrochemicals, and logistics, supported by its proximity to Tuas Port, Jurong Island, and major industrial estates.

Long-Term Potential:

• Infrastructure developments, such as the expansion of Tuas Port and improved connectivity within the Jurong Lake District, are expected to rejuvenate demand and stabilize prices over the long term.

Answer: 

The East Region continues to experience strong demand for industrial spaces, particularly driven by the logistics and e-commerce sectors, which are fueling rental growth and sustaining occupancy levels.

E-Commerce Growth:

• The rise of e-commerce has intensified demand for warehouses and last-mile delivery hubs in the East Region, especially given its proximity to Changi Airport, a major logistics gateway.

Food Manufacturing Hub:

• The East Region remains a focal point for food manufacturing and distribution, with companies leveraging its strategic location to serve both domestic and export markets efficiently.

Connectivity and Accessibility:

• Proximity to key transport nodes, such as Changi Airport and major expressways (e.g., East Coast Parkway and Tampines Expressway), ensures seamless connectivity for businesses operating in the region.

Sustainability Trends:

• New developments in the East Region are incorporating green building features and sustainable designs, aligning with tenant demands for environmentally responsible industrial spaces.

Future Trends:

• As e-commerce continues to grow and demand for temperature-controlled warehouses rises, the East Region is well-positioned to attract further investments in high-specification logistics facilities.

Answer: 

The North Region is emerging as a strategic hub for logistics and manufacturing, driven by its proximity to Malaysia, improving infrastructure, and competitive land prices.

Proximity to Malaysia:

• The North Region’s close proximity to the Johor Bahru–Singapore Causeway and the upcoming RTS Link makes it a preferred location for businesses engaged in cross-border trade, especially logistics and light manufacturing.

Infrastructure Investments:

• Upgrades to road networks and industrial estates in the North Region, such as Woodlands North Coast and new facilities in the Sembawang area, have enhanced its attractiveness to tenants and investors.

Growth of SMEs:

• The North Region has seen a surge in SME activity, particularly in sectors like precision engineering, electronics, and light manufacturing, driving demand for adaptable and cost-effective industrial spaces.

Affordable Land Prices:

• Compared to regions like the Central and East, the North Region offers more competitively priced industrial land, making it an attractive proposition for both tenants and investors.

Future Potential:

• With further infrastructure developments and sustained growth in trade activity with Malaysia, the North Region is expected to maintain its trajectory as a critical industrial and logistics hub in Singapore.

Answer: 

In 2024, transaction volumes for industrial properties rose by 10% compared to 2023, underscoring strong investor interest in Singapore’s industrial property market. This increase reflects confidence in the long-term stability and resilience of industrial assets as well as sustained demand from high-value industries.

Key Drivers of Growth:

• Resilient Asset Class: Industrial properties, particularly those catering to logistics, manufacturing, and e-commerce sectors, continue to be seen as a safe investment amid global economic uncertainties.

• Attractive Yields: Industrial properties in Singapore offer stable yields averaging 5%–7%, making them appealing to institutional investors and private funds.

• Global Supply Chain Trends: Heightened interest in reshoring and nearshoring has further boosted demand for industrial spaces in a stable and strategically located market like Singapore.

Transaction Highlights:

• Larger investors, such as real estate investment trusts (REITs) and funds, have been actively acquiring high-quality warehouses and multiple-user developments, further driving transaction volumes.

Regional and Segmental Trends:

• Transactions are heavily concentrated in regions with modern infrastructure, such as the West and East Regions, where logistics and e-commerce operators are prevalent.

Answer: 

Multiple-User Factories remain a preferred investment choice, driven by their adaptability, stable occupancy rates, and consistent rental growth. These factors contribute to their robust performance in a dynamic industrial property market.

High Adaptability:

• These factories cater to a diverse tenant mix, including small and medium enterprises (SMEs) in sectors such as precision engineering, light manufacturing, and food processing.

• Their modular layouts and smaller units allow investors to cater to varying tenant needs, reducing vacancy risks.

Stable Occupancy Rates:

• Occupancy rates for Multiple-User Factories stood at 91.0% in 4Q 2024, reflecting steady demand across SMEs and light industries, which form a significant part of Singapore’s economy.

Consistent Rental Growth:

• The rental growth for Multiple-User Factories has outperformed other industrial segments, with year-on-year price growth of 4.9% in 2024. This is driven by SMEs’ ongoing expansion and their need for flexible, cost-effective industrial spaces.

Sustainability and Modernization:

• Investors are increasingly attracted to newer developments equipped with sustainable features, such as energy-efficient designs and green certifications, which command premium rents and appeal to ESG-conscious tenants.

Investment Risk Mitigation:

• The broad tenant mix reduces reliance on any single industry, ensuring resilience against sector-specific downturns.

Answer: 

Demand for strata-titled industrial units remains robust, particularly for smaller units under 200 sqm, which account for the majority of transactions in this segment. Approximately 90% of uncompleted units in this size category have been sold, reflecting sustained interest from SMEs and individual investors.

Primary Drivers:

• Affordability: Smaller units offer a lower entry point for both investors and owner-occupiers, making them highly accessible for businesses and first-time investors.

• Ownership Benefits: For SMEs, owning a unit provides cost stability and shields them from potential rental fluctuations, aligning with long-term business strategies.

• Flexibility: These units cater to light industries, logistics, and warehousing, ensuring broad market appeal.

Growth of SMEs:

• Singapore’s SME sector, which forms the backbone of its economy, continues to drive demand for strata-titled units as businesses seek operational independence in a cost-effective manner.

Investor Appeal:

Strata-titled units are favored by investors looking for stable rental income and potential capital appreciation, especially in locations with strong industrial demand.

Answer: 

The Warehouses and Multiple-User Factory segments are the most attractive investment opportunities, bolstered by strong demand from logistics and e-commerce sectors, as well as SMEs.

Warehouses:

• The rise of e-commerce has made modern warehouses critical for last-mile delivery, regional distribution, and cold chain logistics.

• High-specification warehouses equipped with automation and temperature-controlled environments are particularly in demand, as they cater to specialized industries such as pharmaceuticals and food logistics.

• Rental growth in this segment has been consistent, with year-on-year growth of 3.5% in 2024.

Multiple-User Factories:

• These factories provide cost-effective solutions for SMEs across diverse industries, making them a resilient and adaptable asset class for investors.

• Price growth of 4.9% in 2024 reflects strong tenant demand, particularly in regions like the North and East, which benefit from infrastructure investments and proximity to key trade hubs.

Emerging Industrial Segments:

• Investments in cleanrooms and R&D facilities are gaining traction, driven by the growth of high-tech industries such as semiconductors, biotechnology, and precision engineering.

Answer: 

Investors must adopt a comprehensive approach when evaluating industrial property investments, focusing on key factors such as location, infrastructure, tenant demand, and sustainability.

Location:

• Proximity to transportation hubs, such as Tuas Port, Changi Airport, and major expressways, is critical for logistics and manufacturing tenants.

• Regions like the North and East are emerging hotspots due to infrastructure improvements and cross-border trade opportunities.

Infrastructure:

• Properties in established industrial estates with modern amenities, high floor loading capacity, and efficient layouts are more likely to attract long-term tenants.

• Developments in areas such as Kranji Green and Timbre Industrial City offer state-of-the-art facilities, appealing to both SMEs and multinational corporations.

Tenant Demand:

• Investors should prioritize properties that cater to high-demand industries, such as logistics, e-commerce, advanced manufacturing, and high-tech R&D.

• The tenant mix and lease terms are critical considerations for assessing rental income stability and minimizing vacancy risks.

Sustainability Features:

• Properties with green certifications, such as BCA Green Mark, or sustainable features, such as solar panels and energy-efficient systems, are increasingly sought after by ESG-focused investors and tenants.

Market Trends and Future Growth Potential:

• Investors should stay informed about broader market trends, such as the rise of e-commerce, reshoring in manufacturing, and the push toward sustainability, to align their investments with future demand drivers.

Answer: 

The industrial property market in Singapore is projected to receive an additional 1.1 million square meters (sqm) of industrial space in 2026. This forecasted increase reflects the government's proactive measures to ensure a steady and strategic supply of industrial land to support economic growth and evolving industry needs.

Planned Supply Composition:

• The upcoming space will comprise a mix of Single-User Factories, Multiple-User Factories, Warehouses, and Business Parks, ensuring a diversified pipeline that caters to various industrial needs.

• Warehousing facilities are expected to account for a significant share of the new supply, driven by robust demand from the logistics and e-commerce sectors.

• The development of high-tech facilities such as cleanrooms, data centers, and research labs will also form a crucial part of the pipeline to meet the demands of advanced manufacturing and R&D industries.

Steady Growth:

• The projected supply for 2026 aligns with Singapore’s long-term industrial development strategy, which aims to maintain a balance between demand and supply while avoiding market oversaturation.

Support for Emerging Industries:

• With the increasing importance of Industry 4.0, new industrial developments will integrate smart technologies, sustainability features, and modular designs to attract high-value tenants from sectors such as robotics, biotechnology, and semiconductors.

Answer: 

The West and North Regions are expected to be the focal points for industrial development in the coming years, driven by infrastructure enhancements and the availability of industrial land.

West Region:

• Tuas Port Expansion: The ongoing development of Tuas Port, set to be the world’s largest fully automated container terminal, will significantly enhance the region’s logistics and trade capacity. Industrial developments nearby will cater to port-related activities and logistics companies.

• Jurong Lake District: With continued development, this area will serve as a hub for advanced manufacturing and research, attracting tenants in high-value sectors like energy and petrochemicals.

• Heavy Industry Focus: The West Region’s existing strengths in heavy industries and petrochemicals will be reinforced with new developments designed to support sustainable and efficient operations.

North Region:

• Cross-Border Trade Hub: The North Region's proximity to Malaysia and the upcoming Johor Bahru–Singapore RTS Link will position it as a key logistics and manufacturing hub.

• New Industrial Estates: Developments in areas such as Woodlands North Coast and Sembawang will support SMEs and light industries, providing modern and flexible facilities tailored to the needs of emerging businesses.

• E-Commerce Growth: With logistics companies expanding their cross-border operations, the North Region will see increased demand for warehouses and last-mile delivery hubs.

Strategic Considerations:

• The focus on these regions reflects a deliberate strategy to decentralize industrial activity, reduce congestion in central areas, and maximize the economic potential of underutilized land.

Answer: 

The development of new Business Parks will play a transformative role in Singapore’s industrial market by supporting high-tech and R&D industries, driving demand for adjacent industrial properties, and fostering innovation.

Support for High-Value Industries:

• Business Parks are specifically designed to attract companies in technology, biotechnology, and research and development, aligning with Singapore’s broader economic priorities to position itself as a global innovation hub.

• These facilities provide integrated environments with collaborative spaces, sustainability features, and proximity to key research institutions and universities.

Spillover Demand:

• The growth of Business Parks will create spillover demand for industrial spaces in nearby areas. For example, R&D companies in Business Parks may require adjacent factory or warehouse spaces to support prototyping, manufacturing, and distribution activities.

Key Developments:

• Future Business Parks in regions like Punggol Digital District and the expanded Changi Business Park will integrate smart technologies and green infrastructure, appealing to tenants with a focus on innovation and sustainability.

Impact on Adjacent Segments:

• The presence of Business Parks can uplift the attractiveness of nearby Multiple-User Factories and Warehouses, driving rental and price growth in surrounding areas.

Answer: 

The average annual supply of industrial space from 2025 to 2027 is projected to be 1.1 million sqm, exceeding the historical three-year average of 0.9 million sqm. This reflects Singapore’s strategic response to increasing industrial demand while supporting economic transformation.

Balanced Growth:

• The government’s careful planning ensures that the industrial supply pipeline remains balanced, avoiding risks of oversupply while meeting the needs of both traditional and emerging industries.

Focus on Modernization:

• A significant portion of the upcoming supply will feature high-specification spaces, including cleanrooms, data centers, and energy-efficient facilities, designed to cater to industries adopting advanced technologies.

Alignment with Economic Strategies:

• The higher-than-average supply aligns with Singapore’s push toward economic transformation through innovation, sustainability, and digitalization. These developments aim to support the long-term growth of industries like advanced manufacturing and logistics.

Key Drivers of New Supply:

• Expanding sectors such as e-commerce, renewable energy, and robotics are driving demand for modern industrial spaces, necessitating a steady flow of new developments to meet market requirements.

Answer: 

While the future of industrial development in Singapore looks promising, several challenges may affect growth and investor sentiment:

Rising Construction Costs:

• Escalating costs for materials and labor are increasing development expenses, which may lead to higher rental rates and impact affordability for tenants, particularly SMEs.

Cautious Developer Sentiment:

• Developers remain cautious in bidding for new industrial land due to concerns over financing costs, rising interest rates, and global economic uncertainties. This sentiment has been reflected in lower bids for recent GLS tenders.

Sustainability Requirements:

• Meeting the growing demand for green-certified buildings and adhering to Singapore’s sustainability goals require significant upfront investment. Developers must integrate renewable energy systems, energy-efficient designs, and climate-resilient features to remain competitive.

Market Competition:

• Increased supply over the next three years could heighten competition among landlords, especially for older or less modern industrial properties that lack the features tenants now prioritize.

Global Economic Risks:

Geopolitical tensions, inflation, and supply chain disruptions remain external risks that could dampen industrial demand and investor confidence.