Singapore multiple-user factory rents expected to remain flat in 2026
This divergence signals a flight to modern logistics and newer, well-located factories, potentially increasing leasing pressure and landlord competition for older industrial properties.
Savills expects Singapore multiple-user factory rents to remain flat in 2026, while warehouse and logistics rents are forecast to grow by approximately 1%.
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Meanwhile, warehouse and logistics rents are forecast to grow by approximately 1%.
Singapore's industrial market is expected to remain stable through the rest of 2026, but cautious occupiers and softer leasing momentum are likely to limit rental growth, according to Savills.
The consultancy said global economic uncertainty and geopolitical tensions will continue to weigh on business sentiment in the near term. However, resilient regional trade flows, investment in advanced manufacturing and technology, and improving logistics activity should continue to support industrial demand across Asia.
In Singapore, manufacturing, wholesale trade, and transportation and storage are expected to underpin leasing activity. Savills nevertheless expects occupiers to remain cautious about expansion, resulting in more measured demand and rental growth.
Modern logistics facilities are expected to remain the strongest-performing segment, supported by occupiers' preference for efficient, well-connected and high-specification space. Savills expects warehouse and logistics rents to rise by approximately 1% in 2026, although cost considerations and a slower pace of expansion are likely to temper gains.
Factory demand is expected to remain concentrated in newer, well-located multiple-user developments, while older facilities face greater leasing pressure. In light of softer leasing momentum and heightened volatility in the first half, Savills has revised its outlook and now expects multiple-user factory rents to remain flat for the year.
The flight to quality is also expected to persist across business parks and high-specification industrial properties. Savills said demand from technology, life sciences, advanced manufacturing and business services occupiers should continue to support modern developments.
However, elevated vacancies in some older business park clusters and the gradual absorption of recently completed projects are likely to keep competition between landlords high.
Savills said the 4.6% year-on-year decline in industrial leasing volume recorded in the second quarter should be monitored as a potential early indication of softer demand across manufacturing and logistics. Overall, however, the consultancy expects Singapore's industrial market to remain supported by resilient underlying fundamentals through the remainder of 2026.