Singapore Logistics Rents Hit Two-Year Peak, Climb 1.5% on Supply Crunch: Cushman & Wakefield

• Prime logistics rents rose by 1.5% quarter-on-quarter, the strongest quarterly growth since Q1 2024
• Warehouse vacancy fell to 5.6% in Q1 2026, marking the second consecutive quarter of decline
• All industrial property segments recorded positive rental growth in Q1 2026
• New supply across most industrial segments in 2026 is expected to fall below 10-year historical averages

SINGAPORE, April 21, 2026 /PRNewswire/ -- Singapore's industrial real estate market delivered broad-based rental growth across all property segments in the first quarter of 2026, according to Cushman & Wakefield's latest Singapore Industrial Marketbeat report. Driven by a combination of tightening vacancies and a leaner incoming supply pipeline, the market's resiliency is set to be tested.

The Purchasing Managers' Index (PMI) edged up to 50.6 points in February 2026, the seventh consecutive month of expansion, reflecting improving manufacturing sentiment, though Singapore's overall economic growth for 2026 is expected to be revised lower than the current 2.0–4.0% year-on-year forecast amid heightened geopolitical uncertainty stemming from the ongoing Middle East conflict.

Broad-Based Rental Gains Across All Segments

All industrial property segments recorded positive rental growth in Q1 2026. Prime logistics rents rose by 1.5% quarter-on-quarter, the strongest quarterly growth since Q1 2024. Warehouse rents grew at a faster pace of 0.5% quarter-on-quarter to in Q1 2026, up from 0.1% quarter-on-quarter in Q4 2025.

Within the business park segment, suburban rents increased 1.7% quarter-on-quarter, with city fringe rents rising 0.7% quarter-on-quarter. Factory rents also increased with ground floor rents rising 1.6% quarter-on-quarter and upper floor rents going up by 1.5% quarter-on-quarter. High- tech rents grew more moderately at 0.3% quarter-on-quarter, with rental growth continuing to be led by modern, high-specification developments. It is worth noting that the outperformance in select segments, particularly suburban business parks and prime logistics, was in part attributable to the inclusion of newer, higher-quality properties into Cushman & Wakefield's tracking basket.

Tightening Vacancies and Resilient Occupier Demand

The rental momentum across segments was underpinned by tightening vacancy conditions. Warehouse vacancy fell to 5.6% in Q1 2026, marking the second consecutive quarter of decline, as occupier demand outpaced new completions. At the same time, improving manufacturing sentiment, particularly within the electronics cluster, which was the sole manufacturing output cluster to register year-on-year growth in February 2026, has lent support to both factory and high-tech demand.

Demand for prime logistics space continues to be shaped by occupiers' preference for well- located developments. As transportation costs rise in the context of elevated energy prices stemming from the Middle East conflict, tenants are increasingly prioritizing logistics facilities that can help reduce operational expenses. This structural preference is expected to sustain demand for quality industrial space even as broader economic conditions remain uncertain.

"Singapore's industrial market is seeing genuine tightening across most segments. Vacancy is declining, occupiers remain active, and the pipeline is lean. For businesses with near-term space requirements, especially in prime logistics and business parks, the window to secure quality space on favorable terms is narrowing," said Brenda Ong, Executive Director, Head of Logistics & Industrial Services, Cushman & Wakefield Singapore.

A Constrained Supply Pipeline Set to Sustain Market Tightness

Incoming new supply across most industrial property segments in 2026 is expected to be moderate and fall below respective 10-year historical averages. The exception is single-user factories, though the majority of new single-user factory and warehouse supply completing in 2026 is expected to be catered to end-users, limiting availability for multi-user occupiers.

The supply picture is most acute in prime logistics and business parks. There will be no new major prime logistics project completing in 2026, while the business park pipeline tapers off sharply, with only one new project, 27 International Business Park, anticipated for completion this year. Looking further out, supply constraints are expected to persist across most segments, reinforcing the rental growth outlook. The nascent competitive influence of the Johor-Singapore Special Economic Zone (JS-SEZ) is also expected to moderate prime logistics rental growth, as some occupiers weigh cross-border options.

"While near-term macro uncertainty may prompt some occupiers to adopt a wait-and-see approach, Singapore's industrial market fundamentals remain sound," said Wong Xian Yang, Head of Research, Singapore & Southeast Asia, Cushman & Wakefield. "Supply across most segments will stay lean through the medium term, and occupiers with active space requirements would be well-advised to plan ahead rather than wait for conditions to ease."

Q1 2026 Market Statistics

For the full report, click here to download Cushman & Wakefield's Q1 Singapore Industrial Market Report.

About Cushman & Wakefield

Cushman & Wakefield (NYSE: CWK) is a leading global commercial real estate services firm for occupiers and investors with approximately 53,000 employees in over 350 offices and nearly 60 countries. In 2025, the firm reported revenue of $10.3 billion across its core service lines of Services, Leasing, Capital markets, and Valuation and other. Built around the belief that Better never settles, the firm receives numerous industry and business accolades for its award-winning culture. For additional information, visit www.cushmanwakefield.com.

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SOURCE Cushman & Wakefield