Industrial demand shifts toward longer-tenure assets amid cautious operating environment: Savills Singapore
Values of 30-year leasehold industrial possessions tracked by Savills slipped 0.6% q-o-q to $353 psf in 1Q2026, mirroring a lower appetite among investors for such possessions. On the other hand, values of 60-year leasehold assets climbed up 1.4% q-o-q to $569 psf throughout the very same duration. Property properties spotted also more powerful development, with prices rising 2.9% q-o-q to $876 psf.
Industrial assets with a lot longer tenures in Singapore are viewing higher demand, as global unpredictabilities prompt a flight to quality among occupiers and investors, according to a study report by Savills Singapore.
While deal quantity declined, Savills keeps in mind that demand remains continued for “well-positioned properties with a reasonable overall worth quantum”. Specifically, the firm highlights a clear change in purchaser preference towards industrial assets with longer land periods.
Leas for Savills’ basket of prime warehouse and logistics properties rose 0.4% q-o-q to $1.83 psf monthly, supported by durable need for top quality logistics facilities. On the other hand, leas for prime multiple-user manufacturing facilities tracked by Savills fell by 1.4% q-o-q to $2.27 psf, which the firm attributes to “better occupier understanding and pricing sensitivity within the prime private factory segment”.
Singapore industrial sales weakened last quarter, amidst an extra careful operating setting. JTC Corp’s sales caution information shows that strata industrial sales dropped 17.5% q-o-q to 335 offers, the lowest quarterly volume since 2020, says Savills. “The restrained turn over mirrors persisted buyer selectivity, with capital deployment greatly concentrated in assets supplying stronger principles, longer-term worth conservation, or operational benefits,” the record includes.
In the rental market, general leasing volume likewise moderated, with JTC rental information revealing a 1.2% q-o-q decline to 2,867 transactions in 1Q2026. Meanwhile, rental rate activities were blended, emphasizing a much more careful leasing market.
Therefore, Savills Singapore is predicting general rental growth across many industrial sections to remain stable this year. The firm is forecasting rental growth for multiple-user factories and business parks to find in between 0% and 2% in 2026, whilst warehouse and logistics rents are anticipated to expand in between 0% and 1%.
Savills anticipates view in the commercial market to remain mindful, as the Middle East dispute possibly evaluates on economic activity in the coming months. Versus this background, capitalist and occupier need are prepared for to stay careful, skewing towards “contemporary, well-located and higher-specification assets,” says Alan Cheong, executive director for research and consultancy at Savills Singapore.
” The stronger efficiency of longer-tenure properties underscores a trip to quality and tenure safety, with capitalists increasingly prioritising assets that supply higher long-lasting value retention in a much more selective investment atmosphere,” the report discusses.
