Knight Frank trims 2025 factory rental growth forecast on ‘stormy weather ahead’ for industrial sector
The report also highlights JTC’s recent enhancements to the industrial land lease framework. Declared in March, the enhancements consist of offering an extra three years of lease tenure for all new greenfield commercial growths to cover the structure and development duration, and a new system to enable qualified lessees on 20-year JTC leases to extend them by up to 2 tranches of 5 years.
Regardless of the continuous market turmoil, Knight Frank says bright spots remain for Singapore, offered its placement as an appealing and trusted financial investment and company hub. “As US Head of state Trump’s current news of the 10% toll imposed on Singapore goods imported in the US seems the international standard flooring (right now), producers could also think about broadening or relocating last-stage production tasks to Singapore,” the record adds.
Knight Frank has decreased its Singapore plant lease development projection for 2025 to in between 0% and 2%, below the 1% to 3% range forecasted formerly. The lower forecast comes in the middle of “stormy climate forward” for the industrial industry, the firm states in an April research report.
This is expected to place a further drag out industrial property sales activity, which has already revealed a decline since the last quarter of 2024. Information put together by Knight Frank show that overall industrial sales worth fell by 33.9% q-o-q to $680.9 million in 1Q2025. Leasing task also decreased, falling 0.4% q-o-q to 3,008 rental deals. The purchases amounted to $25.6 million in value, 1.1% reduced q-o-q.
“The current spate of tax statements and adjustments in the days ahead have actually produced and continue to produce strengthened uncertainty that oblige industrial users to embrace a cautious pose, affecting transfers and developments,” notices Calvin Yeo, head of occupier method and solutions at Knight Frank Singapore.
Union Square Residences City Developments Limited
Escalating pressures between the United States and China, marked by tariffs and vindictive tariffs, are slowing international trade flows, that Knight Frank anticipates to detrimentally influence Singapore’s manufacturing, electronics and logistics sectors. Already, Singapore’s 2025 GDP projection has actually been reduced, with the Ministry of Trade and Sector decreasing its estimate previously this month to between 0% and 2%, below 1% to 3%.
In addition, Singapore’s construction sector is positioned to expand as a result of huge projects, consisting of Changi Airport Terminal 5 and the expansion of Marina Bay Sands. This, subsequently, would equate to even more demand for purpose-built dormitories, with firms likewise significantly seeking to transform factory area right into dormitories, Knight Frank states.
In the industrial property market, Knight Frank predicts the immediate effect of the business battle will be a decline in transaction volume as buyers and occupiers move right into a state of pause. “Recurring transactions might be postponed as affected parties turn cautious and wait on even more of the circumstance to unfold,” the report reads.
