More en-bloc industrial buildings being transacted amidst redevelopment interest.

• Redevelopment interest has prompted several industrial sites to change hands towards the end of 2019, leading to a marked improvement in both industrial transaction values and volumes by 86% and 150% y-o-y in Q4/2019.
• The worsening business environment for logistics operators has begun to affect the modern warehouse market.
• With landlords more flexible in renewal negotiations in order to retain tenants, modern warehouse vacancy rates nudged up to only 0.9% in Q4/2019, while modern warehouse rents took the strain, declining by 5.4%.
• Redevelopment interest remains the bright spot in the industrial investment sector and with end users also coming back to the market searching for bargains, transaction volumes may be sustained over the next quarter or two.
• With landlords likely to maintain a flexible stance in renewal negotiations, we may see warehouse rents slip further by 5% in 2020.