Growth of the industrial property markets in most Asia Pacific cities have slowed compared to the previous review period as a slowdown in major economies around the world has affected demand for exports by Asia Pacific cities. This, in turn, has dampened demand for industrial premises and slowed new constructions.
The uncertainties in global financial markets, tightening in credit conditions and increased costs of funding have also cooled investment sentiments in most Asia Pacific cities. As a result, acquisitions of industrial premises have dwindled in the period under review compared to the previous period. Moreover, this same set of factors has reinforced leasing as a more cost-effective option compared to owning an industrial premises. This is particularly evident in Melbourne and Sydney.
When measured in US Dollars, land and capital values, and rentals of industrial premises across most Asia Pacific cities showed more significant weakening. This is because in contrast to the previous review period, the US Dollar gained strength against most currencies in the Asia Pacific region during the six-month period ending September 2008. In particular, the US Dollar appreciated 15.5%, 13.9% and 12.2% against the India Rupee, the New Zealand Dollar and the Australia Dollar, respectively.
With the global economy likely to enter into a protracted downturn on the back of the deepening financial crisis, the industrial property markets in the Asia Pacific region can be expected to cool further. While Melbourne, Beijing, Guangzhou, Shanghai, Delhi and Jakarta may continue to see upsides in industrial land and capital values and rents to a varying extent, those in Sydney, Hong Kong, Singapore, Tokyo, Auckland and Wellington are largely forecast to remain flat or slide in the next 12 months.
Source and more info Look: http://www.colliers.com/Content/Repositories/Base/Markets/Singapore/English/Market_Report/PDFs/APInd_Nov2008.pdf
