Savills: High-spec industrial rents at the highest point since 2012
The working as a consultant projects rents of prime warehouse along with logistics real estates will definitely increase 2% to 5% y-o-y for each year in 2022 including 2023. Meanwhile, multi-user factories might regulate from 10% to 12% y-o-y boost in 2022 to 4% to 6% in 2023.
The pick-up in high-spec industrial rental fees remains in line with the general rise seen all over the commercial sector, with storage facility also logistics properties documenting a quarterly boost of 1.4% in 2Q2022 to 2.8% in 3Q2022, where average rents stood at $1.51 psf.
A Savills Singapore study found that the standard month-to-month rent for high-spec commercial space was $3.69 psf in 3Q2022. This is a 1.1% quarterly surge and also matches the documented q-o-q progress in 2Q2022. The rentals cost has climbed given that Savills began accumulating this information in 2012.
“Need for industrial areas, specifically modern-day high spec warehouses, in addition to high-spec commercial and establishment parks with excellent connection and also features will still be derived by growth markets such as the logistics, food, precision engineering together with biomedical markets,” states Alan Cheong, executive supervisor of research at Savills.
Next year, industrial leas are anticipated to increase, combined with the rise in service costs, and even the higher energy in rents will proceed as landlords hand down higher company expenses to renters, claims Cheong.
Based upon a basket of commercial estates tracked by Savills, the costs for 60-year leasehold including freehold commercial residential properties increased by 1.2% q-o-q to $463 psf and $758 psf, respectively. “Aside from the longer standing period and nature of property leases, the rise in costs was generated by the solid cost development for food factory properties,” the Savills record adds.