Healthy demand for higher specification logistics/warehouse premises

• Demand held firm in Q1 2026, with higher specification logistics/warehouse premises remaining sought after. Some new requirements from logistics service providers and e-commerce firms that emerged at end-2025 were carried over to Q1 2026.
• New warehouse openings in Q1 2026 included ST Logistics Hub East at 7 Changi South Lane and Maersk’s World Gateway 2 in Jurong West. Airbus Helicopters also officially opened its new regional logistics hub (c.21,528 sq ft) within the Airport Logistics Park of Singapore.

Two new additions to 2028 supply pipeline

• New completions in Q1 2026 were limited. Meanwhile, two new projects were unveiled during the quarter. CapitaLand Ascendas REIT (CLAR) is developing a new logistics/warehouse facility at a recently purchased site at 19 Gul Lane, with expected completion in 2028.
• Separately, PGIM and Northstar Capital jointly purchased a development site at 51 Tuas View Link with plans to redevelop the property into a new five-storey ramp-up logistics/warehouse facility. We expect the new facility to be ready in 2028.

First uptick in rents and capital values in seven quarters

• The islandwide average rent and capital value rose q-o-q in Q1 2026, after holding stable for six consecutive quarters, while keeping yields unchanged. This was underpinned by firm occupier demand and robust investment activity.
• Notable Q1 2026 deals included UI Boustead REIT’s acquisition of three logistics/warehouse assets at 10, 12 and 16 Changi North Way for a combined SGD 138.8 million, and CLAR’s purchase of the facility at 25 Loyang Crescent for SGD 504.2 million.

Outlook: Renewed tariff uncertainties and surge in geopolitical risk cast a shadow on growth prospects

• While we expect demand for higher specification premises to stay healthy, occupiers could turn increasingly cost conscious should global risks escalate further. This could limit the rental growth potential for the rest of 2026.
• Notwithstanding, capital value growth could still outpace rental growth and tighten yields by year-end, supported by continual investor demand for quality logistics/warehouse assets and Singapore’s attractiveness as a safe investment haven.