“Singapore is the distribution centre between Asia Pacific and the rest of the world,” says Tan Boon Leong, Executive Director of Logistics & Industrial Leasing, Singapore, JLL. “At the heart of our logistics shortage is land.”

Land scarcity lies at the heart of the sector’s persistent demand-supply gap. From 2023 to 2026, Singapore’s West Planning Region’s annual average supply pipeline is expected to fall short of the 10-year annual average net absorption by 600,000 square feet, according to JLL data.

According to Tan, the supply shortage creates competition that benefits the country’s economy. The government — through JTC, the government agency in charge of industrial development — doles out small parcels of land only to investors and end users who meet its stringent criteria, including requirements for sustainability and technology.

For example, solar panels have been made mandatory for all new and renewed facilities on JTC land.

As each parcel of land is small and market options are few, the competitive nature ensures that only businesses that can support the country’s wider goals will be awarded.

“Who qualifies depends on what value they can add to the economy,” says Tan.