Cushman & Wakefield Comments for JTC Q3 2024 Data

Overall industrial rents increased for the 16th consecutive quarter, recording 0.3% qoq growth in Q3 2024 albeit easing from 1.0% qoq growth in Q2 2024. In the first three quarters of 2024, overall industrial rents grew 3.0% YTD, compared to 7.1% growth YTD over the same corresponding period last year. Among the various property segments, multiple-user factory (+0.6% qoq) and warehouse (+0.1% qoq) recorded positive rental growth in Q3 2024, though at a slower pace compared to previous quarter. 

Single-user factory rents declined by 0.3% qoq, following past 15 consecutive quarters of increase. Business park rents fell by 0.2% qoq for the second consecutive quarter in Q3 2024, though occupancy rates have improved up 0.5 percentage points to 78.8% in Q3 2023. Given heightened vacancy rates for business parks, some landlords have lowered rent expectations to bolster occupancy rates.

Overall industrial prices grew by 0.5% qoq in Q3 2024, marking the second consecutive quarter of growth, moderating from previous quarter’s 1.2% qoq growth. In the first three quarters of 2024, overall industrial prices grew 1.5% YTD, compared to 4.5% growth YTD over the same corresponding period last year. Industrial volumes (based on caveats lodged) fell by 21.3% qoq to 457 transactions in Q3 2024, though it grew 1.8% yoy and remains higher compared to the quarterly average in 2019 of 310 units. 

There is good demand for sustainable and modern developments, though many occupiers still face CapEx constraints, which has weighed on new leasing demand. Large occupiers remain cost conscious and prefer renewal than relocation. As such, most demand in the market currently tend to be smaller transactions (up to 10,000 sf) and are primarily due to flight to quality reasons. Fitted units are also highly sought after, as tenants can save CapEx on renovation.

Nonetheless, declining interest rates bodes well for leasing and buying demand though this might eventuate over 2025.