Global economic uncertainty casts pall on industrial property

KNIGHT Frank has presented a cautious picture for Singapore's industrial property market, citing policies that could restrain its growth. At the same time, the Republic is expected to face competition from Iskandar Malaysia in retaining and attracting industrial space users in the near future.

Although Singapore government initiatives such as the ratification of various free trade agreements have helped to boost the Republic's market access and competitiveness, overseas manufacturers are not setting up shop here in large numbers.

"This has more to do with the global economic platform," notes Lim Kien Kim, executive director (industrial) at Knight Frank.

"Due to uncertainty in major global economies, big overseas manufacturers are not readily making investments outside their own borders. As for industrialists already in Singapore, some are moving from one building to another without expansion, while others have been downsizing their operations in Singapore in favour of lower-cost alternatives. When this happens, our local SMEs, which are mostly in supporting industries that depend on big companies coming in to Singapore, also suffer," said Mr Lim. This in turn will dampen demand all round for factory space in Singapore vis-a-vis abun…