The Future of Self-Storage Industry in Singapore

Singapore’s self-storage industry is undergoing significant changes as industrial landlord JTC reviews the use of self-storage facilities located across the island. The agency has announced that self-storage companies can continue operating in their current locations until their leases expire, with further discussions planned to align industrial needs with the use of such sites.

Expansion Opportunities for Self-Storage Facilities

  • JTC will allow self-storage facilities only in areas designated for light and clean industries, not in core industrial areas.
  • Several locations, including Bishan, Clementi, Tampines, and Woodlands, have been identified for potential conversion of industrial properties into self-storage facilities.
  • Interested parties can apply to JTC for the conversion of industrial properties to self-storage use.

Growth and Demand in the Self-Storage Segment

The self-storage industry in Singapore is experiencing rapid growth, with estimates suggesting a compounded growth rate of 9 to 18 percent. Major players like StorHub, Extra Space, Storefriendly, Spaceship, and Lock+Store cater to both individual consumers and small and medium-sized enterprises.

However, the use of self-storage facilities does not align with the mandated industrial use of JTC properties, which are intended to support economic development and job creation. Current tenants primarily serve individual clients and do not have the same economic impact as traditional manufacturers.

Industry Response and Engagement

Following consultations with self-storage players, JTC has lifted the moratorium on requests for self-storage use on industrial land. The Self Storage Association Asia (SSAA) has expressed its support for JTC’s decision and continues to engage with the agency on concerns that may affect the availability of self-storage services to SMEs and families.

According to the SSAA, there is pent-up demand for self-storage services, with up to 17,000 SMEs relying on such facilities. Nearly 54 percent of these SMEs are in manufacturing or manufacturing-related industries.

Challenges and Uncertainties

Industry experts like Mr. Jes Johansen and Mr. Andrew Work highlight the challenges faced by self-storage operators, including uncertainty surrounding lease renewals and the need for clarity on regulatory environments. Cost management is also a priority, given the significant rise in industrial rents in recent years.

CBRE research head Tricia Song emphasizes that self-storage players with high occupancy rates are likely to engage actively with JTC to facilitate their expansion plans.

Conclusion

The evolution of Singapore’s self-storage industry reflects the changing landscape of industrial real estate and the growing demand for flexible storage solutions. As stakeholders navigate challenges and seek clarity on regulatory frameworks, the sector is poised for further growth and innovation.

FAQs

1. What areas in Singapore are designated for self-storage facilities?

Self-storage facilities are allowed in areas earmarked for light and clean industries, excluding core industrial zones like Boon Keng, Toa Payoh, and Ang Mo Kio.

2. How is the Self Storage Association Asia responding to the industry changes?

The SSAA is actively engaging with JTC and industry players to address concerns and ensure the availability of self-storage services for SMEs and families.

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