Preliminary real estate investment volume in Singapore for the first quarter came to S$2.659 bn, a 31.3% drop from the previous quarter, marking the second consecutive quarter of decline in investment volume.
Companies are finding it difficult to obtain budget approvals for capital expenditure. As such, this resulted in more renewals this quarter. Downsizing has been a more common feature.
Akin to the office sector, most of the leasing activity centered on renewals. Only some pockets of space within the City Fringe submarket were taken up by the technology sector.
Consumption spending on discretionary items and retail sales are likely to take a further hit as stay at home measures come into effect, along with the barring of international visitors and social distancing measures in malls.
New home sales for Q1 2020 was still 22.7% y-o-y higher. This is due to numbers recorded in Jan and Feb 2020, coupled with the fact that the full impact of the COVID-19 has only been felt end-Mar 2020.
While leasing performance was relatively stable in the first two months of Q1 2020, the impact of the pandemic was apparent in March, resulting in falls in both factory and warehouse rents.