Increase in average rents for factories, warehouses in Q3

The average rents and capital values for factories and warehouses in Singapore continued to increase in the third quarter, but the average rent for hi-tech buildings stayed unchanged, according to property consultancy CB Richard Ellis (CBRE).

It also noted a healthy level of activity in the investment market for industrial properties with major investment transactions totalling S$835.7 million in the third quarter.

That is up from just S$386.3 million in the previous quarter.

CBRE said the average monthly rents for ground floor and upper floor factory units also showed an increase although at a slower pace than the second quarter.

The average rent for ground floor units rose by 6.5 per cent to S$1.65 per square foot while the average rent for upper floor units increased by 4 per cent to S$1.30 per square foot.

Meanwhile, the monthly rent for hi-tech spaces held firm at S$2.45 per square foot in the third quarter.

CBRE said fewer office tenants are moving to hi-tech buildings to enjoy rental savings resulting in slower demand for such spaces.

The consultancy expects rents for factories to continue to rise at a less robust pace in the fourth quarter as demand moderates.

But warehouses are expected to continue to see healthy demand in the immediate future, driven by healthy demand from companies looking to Singapore as a platform into Asia.

Source : Channel NewsAsia – 13 Oct 2010

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