JTC’s price index of all industrial space slid another 0.3% q-o-q and 0.3% y-o-y in 3Q2015 to 106.6, with the total decline at 1.2% from the recent peak in 2Q2014. Multiple-user factories led the decline with prices falling 0.4% q-o-q and 0.8% y-o-y, compared to the smaller 0.1% q-o-q decline and 0.6% y-o-y rise in single-user factory prices.

Multiple-user factories in the North Region bucked the trend with prices increasing 0.5% q-o-q. Factories zoned Business 2 also saw capital appreciation of 0.8% q-o-q against the 0.8% decline for B1 factories.

On the rental front, the index of all industrial space continued its downtrend since 2Q2014, with a 0.8% q-o-q and 1.6% y-o-y decline to reach 101.7 in 3Q2015. Rents for multiple-user factories were less resilient, sliding 0.8% q-o-q and 1.6% y-o-y, compared to the 0.6% q-o-q gain and 0.2% y-o-y fall for single-user factories.

Business 2 factory rents fell more sharply at 1.9% compared to just 0.8% for B1 factories. Factories in the Central Region enjoyed rental appreciation of 0.4% while all other regions saw rents falling, with the steepest decline of 6.4% in Northeast Region.

Another 6 million sq ft of factory space is expected to be completed in 4Q2015, with a further 24 million sq ft next year.

According to DTZ, the decline in prices and rents for most types of industrial space is owing to falling exports and fewer orders from main trading partners. Manufacturers continue to face headwinds from a relatively strong SGD and a weaker Chinese economy. Upcoming completions in 4Q2015 and 2016 are expected to add pressure to occupancies and rentals.