Strong Demand For Ready-Built Facilities

Source : The Business Times, August 1, 2007

JTC's net allocation jumps to 58,200 sq m in Q2 from 6,700 sq m in Q1

NET allocation of JTC's ready-built facilities (RBF) increased 770 per cent in the second quarter of this year to 58,200 sq m, from 6,700 sq m in Q1. And the overall occupancy rate for RBF increased one per cent to 89 per cent.

The segment's performance was supported by increases in net allocation of flatted and standard factory space.

The RBF segment includes business park, technopreneur, flatted factory, standard factory and stack-up factory space.

JTC said the segment's strong performance was supported mainly by increases in net allocation of flatted factory and standard factory space, which contributed 48 per cent and 38 per cent of the total net take-up respectively.

In terms of industries, precision engineering accounted for 19 per cent of demand for flatted factory space, while general manufacturing accounted for 17per cent.

Services, which include wholesale and retail and information / communications, accounted for 50 per cent of the gross allocation of flatted factory space.

Savills Singapore's director of industrial business space Dominic Peters reckoned the spike in allocation could also have been due to the migration of businesses from Alexandra Distripark.

Earlier this year, Mapletree said it would demolish three existing industrial blocks at Alexandra Distripark with a gross floor area of around 1.6 million sq ft and build four new blocks with an estimated 1.96 million sq ft of business park space.

Interestingly, JTC's data reveals that demand and supply for business park space - which is said to benefiting from the spillover from the CBD - remained stable over the quarter, with net allocation at 700sq m.

But Mr Peters pointed out that rents for business park space have increased about 20 per cent on average.

JTC said net allocation of prepared industrial land (PIL) dropped to 64.4 ha in Q2, from 95.7 ha in Q1.

It said the high Q1 figure was due largely to a sizable allocation to a petrochemical company on Jurong Island, which alone accounted for 50 per cent of total gross allocation of PIL.

Key segments that saw significant growth in Q2 included Tuas Biomedical Park and Wafer Fab Park, with net take-up rates of 19.9 ha and 16 ha respectively.