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Growth in artificial intelligence-related industries led to increased demand for Singapore's industrial space during the third quarter of 2026, despite a slight dip in occupancy rates. Industrial rents and prices continued to rise, with Q3 rents being 2.1% higher than the previous year and prices climbing 4.2% year on year. Occupancy rates, however, eased by 0.2 percentage points to 88.9%.

JTC's industrial landlord report attributed the steady rental growth since the third quarter of 2020 to continued strength in AI-related industries, with occupancy being influenced by tenants vacating older factories earmarked for redevelopment and geopolitical tensions weighing on occupier sentiment. Business park rents increased by 0.1% quarter-on-quarter, while warehouse space rental grew by 1%, and industrial space occupancy remained strong at 89.7%.

With an estimated 300,000 sq m of new industrial space expected to be completed by the end of September, the market is anticipated to see modest rental growth of 2 to 3% for the year and price increases of 3 to 4%.