As per data released by the authorities, the country’s land sale programme for the first half of 2024 is largest by area of any six-month plan since the second half of 2014
Singapore is set to auction off 29% more industrial land in the first half of 2024 in its biggest offering of shed sites in a decade, although experts anticipate tepid bidding amid a slowing market. In releasing its sale programme for industrial land for January through June, Singapore’s Ministry of Trade and Industry (MTI) said it will make available to developers five sites with a combined land area of 8.3 hectares (34 acres), with that amount representing nearly a third more land than the 6.43 hectares which the ministry made available through the five sites that were auctioned off in the second half of 2023.
With Singapore industrial vacancy already rising to 11% and rental growth slowing to 2% in the third quarter, according to Colliers, the property agency expects bidding for the sites to remain subdued on the back of a sluggish economy. Part of a biannual series of releases, Singapore’s land sale programme for the first half of 2024 is largest by area of any six-month plan released by MTI since the second half of 2014, when the government made available a combined 9.5 hectares of industrial land, based on data from Huttons Asia.
The largest of the five sites in the upcoming programme is a 4.45-hectare plot on Kallang Way in Macpherson district, which will be made available in June with a 32-year tenure. In the island’s western region, two neighbouring plots along Penjuru Lane and on Penjuru Road will be auctioned off in April and May, respectively, while the 0.9-hectare Plot 8 Jalan Papan near Jurong district, is set to hit the market next month. A 0.5-hectare site at Tampines North Drive 5 in the island’s easternmost region will be rolled out to potential buyers in February.
In addition to the main programme, the trade ministry in the same announcement revealed a reserve list of five additional sites spanning 5.46 hectares, which may be tendered if potential buyers express adequate demand for the additional space. In its statement recently, MTI underlined that it will continue to offer more sites to ensure an adequate supply of industrial space in the Lion City. In addition to the boost in supply in the coming months, Singapore’s government is also planning to add more industrial space in the longer term, with the media reported revealing earlier this week, a scheme to reclaim as much as 172 hectares of industrial land near the new port in Tuas district by 2029.
With roughly one million square metres (10.7 million square feet) of newly built industrial space entering the market from 2024 through 2026 – 43% more than the 700,000 square metres leased on average each of the past three years – the agency sees vacancy, which is likely to average 11.5% for 2023, rising further from the market’s 10.6% average from 2018 through 2022.