Industrial demand shifts toward longer-tenure assets amid cautious operating environment: Savills Singapore
Values of 30-year leasehold commercial possessions tracked by Savills slipped 0.6% q-o-q to $353 psf in 1Q2026, reflecting a lower appetite amongst capitalists for such properties. In contrast, values of 60-year leasehold assets climbed up 1.4% q-o-q to $569 psf throughout the exact same period. Estate properties spotted also more powerful growth, with costs rising 2.9% q-o-q to $876 psf.
” The more powerful performance of longer-tenure assets underscores a flight to quality and period safety, with investors significantly prioritising assets that supply greater lasting value retention in an extra discerning financial investment atmosphere,” the record explains.
Industrial properties with longer tenures in Singapore are viewing greater demand, as global unpredictabilities prompt a flight to quality amongst occupiers and investors, according to a research report by Savills Singapore.
Savills anticipates belief in the commercial market to remain mindful, as the Middle East problem possibly weighs on economic action in the following months. Versus this backdrop, financier and occupier demand are anticipated to remain selective, skewing towards “modern, well-located and higher-specification assets,” claims Alan Cheong, executive supervisor for research and consultancy at Savills Singapore.
Singapore industrial sales weakened last quarter, amid a more careful operating setting. JTC Corp’s sales caution data shows that strata industrial sales fell 17.5% q-o-q to 335 deals, the lowest quarterly volume since 2020, claims Savills. “The controlled turnover reflects continued buyer selectivity, with resources release mainly focused in assets supplying more powerful basics, longer-term value conservation, or operational benefits,” the report adds.
While deal quantity decreased, Savills keeps in mind that demand stays maintained for “well-positioned properties with a practical overall value quantum”. Particularly, the firm highlights a clear shift in customer preference towards industrial properties with longer land periods.
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In the rental market, total leasing quantity additionally regulated, with JTC rental information showing a 1.2% q-o-q decline to 2,867 deals in 1Q2026. Meanwhile, rental price motions were blended, emphasizing a much more careful leasing market.
Therefore, Savills Singapore is projecting general rental growth throughout a lot of industrial sectors to continue to be secure this year. The company is anticipating rental growth for multiple-user factories and business parks ahead in between 0% and 2% in 2026, whilst warehouse and logistics rents are expected to expand between 0% and 1%.
Rental fees for Savills’ basket of prime storehouse and logistics assets increased 0.4% q-o-q to $1.83 psf monthly, supported by resistant demand for top quality logistics centers. On the other hand, leas for prime multiple-user manufacturing facilities tracked by Savills plunged by 1.4% q-o-q to $2.27 psf, which the company credits to “higher occupant perception and prices sensitivity within the prime exclusive factory section”.
