Industrial demand shifts toward longer-tenure assets amid cautious operating environment: Savills Singapore
Worths of 30-year leasehold commercial possessions tracing by Savills slipped 0.6% q-o-q to $353 psf in 1Q2026, reflecting a lesser appetite among financiers for such properties. In contrast, values of 60-year leasehold properties climbed 1.4% q-o-q to $569 psf across the same period. Property properties spotted also more powerful development, with prices rising 2.9% q-o-q to $876 psf.
Rents for Savills’ basket of prime storehouse and logistics possessions rose 0.4% q-o-q to $1.83 psf each month, sustained by resilient need for premium logistics facilities. On the other hand, rental fees for prime multiple-user manufacturing facilities tracked by Savills dropped by 1.4% q-o-q to $2.27 psf, which the company credits to “higher occupant understanding and pricing sensitivity within the prime private factory section”.
Singapore industrial sales weakened last quarter, amid an extra mindful operating atmosphere. JTC Corp’s sales caveat information shows that strata industrial sales fell 17.5% q-o-q to 335 deals, the lowest quarterly volume since 2020, claims Savills. “The restrained turnover shows continued customer selectivity, with funding deployment mainly focused in assets providing more powerful basics, longer-term value conservation, or operational advantages,” the record includes.
Industrial properties with a lot longer periods in Singapore are viewing higher need, as international uncertainties prompt a flight to quality amongst tenants and investors, according to a study report by Savills Singapore.
While deal quantity dropped, Savills notes that need remains sustained for “well-positioned assets with an affordable total worth quantum”. In particular, the company highlights a clear shift in customer choice towards industrial assets with longer land periods.
Lentor Gardens Residences Singapore
Consequently, Savills Singapore is projecting overall rental development across many industrial segments to stay steady this year. The firm is anticipating rental growth for multiple-user factories and business parks to find in between 0% and 2% in 2026, whilst warehouse and logistics rents are expected to expand between 0% and 1%.
” The more powerful efficiency of longer-tenure possessions highlights a trip to quality and period security, with investors increasingly prioritising assets that use better lasting value retention in an extra discerning investment setting,” the report clarifies.
In the rental market, total leasing quantity additionally regulated, with JTC rental information revealing a 1.2% q-o-q decrease to 2,867 transactions in 1Q2026. Meanwhile, rental price movements were mixed, emphasizing a much more discerning leasing market.
Savills expects view in the commercial market to continue to be cautious, as the Middle East problem potentially evaluates on economic action in the coming months. Against this backdrop, capitalist and inhabitant demand are expected to remain discerning, skewing in the direction of “contemporary, well-located and higher-specification assets,” claims Alan Cheong, executive supervisor for research and consultancy at Savills Singapore.
