|
Hi-tech rents, occupancy rates up
Insufficient and expensive offices drive tenants to business parks,
leading to 6.8% rise q-o-q
Rents and occupancy rates for hi-tech and
business park space were lifted in the second quarter of this year by
spillover demand for office space, property consultants say. And rents for
factories and warehouses have edged up too.
  |
| JTC's Biopolis: More
business park space will be coming on stream. According to CBRE,
Biopolis Phase III will be completed in Q4 2009 |
According to CB Richard Ellis (CBRE), the
average island-wide hi-tech monthly rent rose 6.8 per cent
quarter-on-quarter to $3.15 per sq ft (psf) in Q2. Year-on-year, the
increase was 34 per cent.
Insufficient and increasingly expensive
office space is driving tenants to hi-tech space or business parks, CBRE
said in a statement yesterday.
Jones Lang LaSalle (JLL) also says that
companies are relocating backroom operations to hi-tech space. Its latest
figures show that the average island-wide hi-tech rent rose 2.4 per cent
quarter-on-quarter to $4.25 psf per month in Q2. Compared with a year
earlier, the increase was 63.5 per cent.
While figures from both property
consultants indicate rising rents for hi-tech space, the degree of increase
differs.
'The disparity is a result of differences
in the basket of properties that research houses use to track the market,'
said JLL's head of research (South-east Asia) Chua Yang Liang. 'This
difference is more pronounced in periods when segments of the market respond
differently to external stimulus.'
CBRE says that for business parks, the
average occupancy rate was 88 per cent at end-March and could have exceeded
90 per cent by the end of Q2. This would be a new peak.
The firm's director of industrial and
logistics services, Bernard Goh, says that rents at business parks also rose
in Q2.
More business park space will be coming
on stream. According to CBRE, Biopolis Phase III will be completed in Q4
2009. And JTC Corporation launched a tender for Plot 61 in Changi Business
Park last month.
For factory space, the average monthly
rent for a ground-floor unit rose 3.3 per cent to $1.55 psf in Q2, says CBRE.
The average capital value of ground-floor
units in 60-year leasehold strata-titled factories edged up about 3 per cent
quarter-on-quarter to $302 psf.
Ground-floor units in warehouses
registered a 3.3 per cent increase in average monthly rent to $1.55 psf in
Q2.
Rising raw material costs, a stronger
Singapore dollar and weakening demand for exports have made manufacturers
cautious about their outlook, dampening demand for factories and warehouses,
says CBRE.
'However, the government has reiterated
that the manufacturing sector will remain important to Singapore's economy,'
it says. 'As such, manufacturers are still encouraged to set up their
facilities on the island, and demand for industrial space is expected to
remain healthy.'
CBRE points out that recently there have
been few purchases by industrial REITs, as funding availability has dropped.
According to Mr Goh: 'The limited credit supply is likely to continue to
curtail the ability of the REIT players to expand their respective
portfolios, but on the whole, industrial properties continue to remain an
attractive asset class for institutional investors.'
- 2008 July 3 THE
BUSINESS TIMES
|
