THE average monthly rent for high-tech industrial space has increased by 15 per cent in this quarter to $3.45 per square foot per month, real estate consultant DTZ Debenham Tie Leung reported.
High-tech industrial space includes business park and science park space such as Changi Business Park and International Business Park, and rents there now range from $3 to $4.50 psf per month. The monthly asking rent for the newly completed Eightrium @ Changi Business Park is also in the vicinity of $4 psf.
DTZ executive director (consultancy and research) Ong Choon Fah attributed the increasing rents to the continuing spillover demand for conventional office space.
The latest figures showed that business parks experienced a 5 per cent drop in occupancy in the second quarter of this year due to the completion of Eightrium @ Changi Business Park and Xinlinx Asia Pacific’s business park development at Changi Business Park Vista.
Mrs Ong added: ‘Notwithstanding the dip in occupancy rate, demand for business parks remains strong.’
HSBC will take up 10,000 square feet of space at the Comtech, she noted.
Islandwide, private industrial stock, which includes factory and warehouse space, rose one per cent to 295 million sq ft in the second quarter. The average occupancy rate of private factory space rose marginally by 0.1 of a percentage point quarter-on-quarter to 90.7 per cent in the second quarter while islandwide occupancy rate of warehouse space stood at 89 per cent.
Separately, JTC Corporation launched a 20,867 square metre land parcel at Jalan Tepong for sale yesterday. Industry executives expect this site, which is the second of the two industrial sites for the year to be launched under the Government Land Sales Confirmed List, to go for between $380 and $400 per sq m per plot ratio. The site has a plot ratio of 1.4 and can be used for light industry, general industry, warehousing, utilities or telecommunications.
Demand for high-tech space could see new entrants into the market building their own facilities.
Jones Lang LaSalle (JLL) associate director (industrial markets) Tahlil Khan said that his firm is working with a number of organisations and is looking at public tenders and direct allocation of sites ‘depending on the preferences, accommodation needs and objectives of the occupier’.
David Wilton, JLL regional director and head of industrial (Asia) said that users were unlikely to find space at what he called ‘the existing business park or high-tech inventory’.
He said that these users were left with three options: purchase land to occupy; commission a leased facility; or negotiate with owners/developers on facilities under development or construction.
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