Singapore News
Singapore's industrial sector posted weaker sales in Q2 2014, with only 354 caveats lodged for strata factories and warehouses, down 28.2 percent from the previous quarter and 63.3 percent down year-on-year, according to a Savills report.
The report also noted that 60-year leasehold units sold more than twice the number of both freehold and 30-year leasehold units.
"This implies that there is greater buying confidence in 60-year leasehold units as they are perceived to be more fairly priced," it said.
In Q2, prices of 30-year leasehold upper-storey factory and warehouse units tracked by Savills fell 1.5 percent, while 60-year leasehold and freehold prices climbed 0.9 percent and 3.4 percent respectively.
According to Savills, the current oversupply of 30-year leasehold units, which had negatively affected prices, is "exacerbated by the government's plan to release an average of around 5.4 million sq ft of multi-user factory space over the next three years."
Meanwhile, the industrial leasing scene remained active, with 1,426 rental transactions in April and May, or just 18.6 percent short of Q1's total of 1,752 deals.
However, rents continue to stagnate as manufacturers battle to contain high operating costs and landlords pushing for better rental returns. Specifically, monthly rents of both upperstorey factory and warehouse units held firm at S$2.00 per sq ft, while high tech units remained unchanged at S$3.00 per sq ft per month.
The business park leasing market also posted a strong performance in Q2 2014. Notably, a total of 61 leasing deals were registered in April and May, and is expected to surpass the record of 68 transactions set in Q3 2012 and Q1 2013.
Looking ahead, Savills expects the number of transactions in the sales market to remain low compared with previous years primarily due to the price gap between sellers and buyers.
The report also noted that 60-year leasehold units sold more than twice the number of both freehold and 30-year leasehold units.
"This implies that there is greater buying confidence in 60-year leasehold units as they are perceived to be more fairly priced," it said.
In Q2, prices of 30-year leasehold upper-storey factory and warehouse units tracked by Savills fell 1.5 percent, while 60-year leasehold and freehold prices climbed 0.9 percent and 3.4 percent respectively.
According to Savills, the current oversupply of 30-year leasehold units, which had negatively affected prices, is "exacerbated by the government's plan to release an average of around 5.4 million sq ft of multi-user factory space over the next three years."
Meanwhile, the industrial leasing scene remained active, with 1,426 rental transactions in April and May, or just 18.6 percent short of Q1's total of 1,752 deals.
However, rents continue to stagnate as manufacturers battle to contain high operating costs and landlords pushing for better rental returns. Specifically, monthly rents of both upperstorey factory and warehouse units held firm at S$2.00 per sq ft, while high tech units remained unchanged at S$3.00 per sq ft per month.
The business park leasing market also posted a strong performance in Q2 2014. Notably, a total of 61 leasing deals were registered in April and May, and is expected to surpass the record of 68 transactions set in Q3 2012 and Q1 2013.
Looking ahead, Savills expects the number of transactions in the sales market to remain low compared with previous years primarily due to the price gap between sellers and buyers.
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