Page 89 - ar2012

INDEPENDENT MARKET STUDY (SINGAPORE)
3. Hi-Tech Industrial
3.1 Supply and Demand
Offcial statistics on the hi-tech2 or the independent high-
specifcations (high-specs) industrial market are not available.
Based on Colliers International’s research, the supply of new
independent high-specs space was relatively limited over the
past fve to six years, with the majority or close to 80% of the
existing stock likely to have been completed prior to 2005. As
of 4Q 2011, Colliers International estimated that the stock of
independent high-specs industrial space totalled 928,000 sq m,
up 1.0% YoY.
The existing stock could increase by the addition of some
113,000 sq m3 of new space (net foor area) from 2012 to 2014
or an average of about 37,700 sq m per year. This is almost four
times the estimated annual net new supply registered in 2010
and 2011 and 47.8% higher than the estimated net new demand
of 25,500 sq m seen during the same period. Notwithstanding
the seemingly large upcoming supply, approximately 47% of
this had been pre-committed as of 4Q 2011.
The new supply would comprise NTT Worldwide
Telecommunications Corporation’s data centre project located
on Serangoon North Avenue 4 (12,300 sqm), Google Asia Pacifc
Pte Ltd’s data centre (31,100 sq m) on Jurong West Avenue 2/
Jurong West Street 23, Ho Bee’s One Pemimpin project (10,700
sq m) and an extension of UE Bizhub Central (9,000 sq m) in the
Ang Mo Kio area.
Additionally, Mapletree Industrial Trust (“MIT”) announced
in January 2012, its plans to reposition the cluster of fatted
factories located on the Marsiling Industrial Estate Road 3
as a high-tech industrial facility for biomedical and medical
technology companies. The asset enhancement initiative
(“AEI”) will involve the building of a four-storey extension wing,
a multi-storey car park and a canteen, as well as the upgrading
of common facilities. The AEI is expected to add approximately
4,600 sq m of gross foor area (“GFA”) when completed in 2Q
2013. MIT also plans to carry out AEI at the fatted factory cluster
located in Toa Payoh North. The AEI involves the development
of a new high-tech industrial building and an amenity block
with an air-conditioned canteen on the existing open car park
space, adding approximately 13,900 sq m of GFA. The AEI is
targeted to be completed in 4Q 2013.
According to Colliers International’s estimates, a total of about
24,500 sq m of independent high-specs industrial space was
absorbed in 2011, supported by continued albeit slower growth
in the manufacturing sector. Although net new demand in 2011
is down 7.5% YoY, it outstripped the net new supply of 9,100 sq
m during the year. This helped to lift the average occupancy
rate by 1.8 percentage points YoY to about 86.8% as of 4Q 2011,
according to Colliers International’s estimates.
3.2 Rents of Independent High-Specs Space
Based on Colliers International’s tracking of a basket of
properties, the monthly gross rents of prime independent multi-
user high-specs industrial space escalated by 8.5% YoY and
8.7% YoY for ground and upper foor space to average at S$3.46
per sq ft (S$37.24 per sq m) and S$3.25 per sq ft (S$34.98 per sq
m), respectively as of 4Q 2011, which are 17.2% and 12.2% lower
compared to their corresponding peaks in 2Q 2008.
Note: F denoted forecast
Source: URA/Colliers International Singapore Research
Net Floor Area (‘000 sq m)
60
50
30
40
10
20
0
2010 2011 2012F 2013F 2014F 2015F
Completed
Upcoming
Net New and Potential Supply of Independent
High-Specifcations Space (as of 4Q 2011)
BY COLLIERS INTERNATIONAL
Source: Colliers International Singapore Research
Average Monthly Gross Rents for
Prime Independent High-Specifcations Industrial Space
S$ Per Sq Ft / Month
4.50
4.00
3.00
3.50
1.00
1.50
2.00
2.50
0.50
0.00
2002 2003 2004 2005 2006 2007 2008 2009 2010 2011
Ground Floor
Upper Floors
Potential supply includes those under construction and planned but the actual level
of new supply could increase / decrease due to changes in the status of planned
projects.
Colliers International Singapore Research defnes this as “Independent High-
specifcations or High-Specs” industrial space.
Potential supply includes those under construction and planned but the actual level
of new supply could increase / decrease due to changes in the status of planned
projects.
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A DECADE OF ENABLING BUSINESSES