Author: Edith Tay, Executive Director, PropertyBank
June 2025 – 5 min read
Singapore’s commercial property market is no stranger to global uncertainty. But in 2025, with tariff wars reigniting, export headwinds building, and policy shifts unfolding, it’s more important than ever to understand what’s shaping the landscape.
This month, we unpack the latest global and local developments affecting Singapore’s commercial and industrial space, and how business owners and investors can move forward with clarity.
1. Tariff Tensions Are Back, And They Matter More Than You Think
April 2025 saw a fresh wave of global trade volatility. U.S. President Donald Trump imposed sweeping tariffs: a blanket 10% on all imports, and over 100% on select Chinese goods. China swiftly retaliated with an 84% tariff and later raised it to 125% on U.S. goods.
The world watched markets tumble, then rebound. But for Singapore, a trade-reliant hub, this isn’t just noise. Tariffs reshape how global businesses plan, produce, and expand. That directly affects what gets built, leased, or bought in Singapore.
Even if we’re not directly targeted, global trade friction slows decision-making, triggers supply chain shifts, and prompts companies to reassess where to base their operations. Some relocate here. Others wait. Either way, space strategy is shifting.
2. Budget 2025: Quiet Wins for Commercial Property
This year’s Singapore Budget didn’t make headlines for real estate. But dig deeper, and you’ll find several pro-business moves that indirectly boost confidence in the commercial sector:
- Corporate Income Tax rebate, capped at S$40,000, helps SMEs improve cash flow.
- Direct cash grants ensure even non-profitable companies receive support.
- S$1B investment in medtech and bioscience infrastructure.
- S$5B Future Energy Fund to support clean energy ecosystems.
Together, these initiatives inject confidence into high-growth sectors like advanced manufacturing, clean tech, and semiconductors, all key drivers of industrial space demand.
More importantly, there were no new cooling measures or property taxes targeting commercial real estate. For landlords and investors, this policy stability is a win.
Want to see how global trade shifts are already influencing Singapore’s property landscape?
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3. Export Pulse: Electronics Rebound, Pharma Steady
Singapore’s export outlook has turned cautiously optimistic:
- Electronics exports are recovering after a steep 2023 slump.
- Pharmaceuticals remain strong, buoyed by global healthcare demand.
- Non-oil domestic exports (NODX) rose 7.6% in February 2025.
Yet, economists warn of softening in H2 2025 if global trade worsens. Still, for now, export-facing firms in tech and life sciences are driving real demand for production space, logistics hubs, and R&D offices.
Industrial properties near high-spec parks (think Punggol Digital District, CleanTech Park) are well positioned. For commercial real estate investors, follow the trade flows.
4. Sector Breakdown: Office, Industrial, Retail in 2025
Office
- Office rents in the CBD are stabilising, with Q1 2025 seeing a 0.8% uptick for Grade A offices.
- 1.05 million sqft of new supply hit the market, pushing vacancy up to 11.7%.
- Flight to quality continues, with newer buildings faring better than ageing stock.
- Fringe CBDs and flexible formats are gaining traction amid cautious expansions.
Industrial and Logistics
- Occupancy remains high at 89%, with robust demand from semicon, logistics, and AI sectors.
- Business parks serving medtech and biotech firms are experiencing healthy leasing activity.
- Budget investments and geopolitical shifts are pushing demand for next-gen facilities.
Retail
- Overall retail rents dipped 0.5% in Q1, with a slight rise in prime locations.
- Tourism growth has plateaued, but suburban malls and F&B retail remain resilient.
- Experience-led and mixed-use retail is the trend to watch.
Construction and Development
- BCA forecasts S$47-53B in construction demand in 2025.
- Mega-projects like Changi T5 and Marina Bay Sands expansion are key drivers.
- Construction costs remain high, which may lift the value of existing commercial stock.
5. Financial Market Signals: What Investors Should Note
- Inflation in Singapore has eased to 2.4%, with MAS adopting a more dovish tone.
- Interest rates are stabilising globally, with talk of potential cuts in late 2025.
- This favours yield-hunting investors looking at commercial assets.
With bond yields peaking, commercial real estate offers a compelling hedge, especially for those seeking income-generating assets in a safe, regulated market.
Singapore continues to shine as a stable, strategic hub amid global chaos. Commercial assets, from business parks to prime CBD offices, offer both protection and potential.
Final Word: In Times of Uncertainty, Plan with Precision
At PropertyBank, we help business owners and investors cut through the noise. Whether you’re upgrading offices, expanding facilities, or scouting your next smart investment, our team is here to guide you through 2025’s challenges and opportunities.
About the Author
Edith Tay is the Executive Director of PropertyBank, with over 15 years of experience in Singapore’s commercial and industrial real estate market. A published author and frequent guest on platforms like Money FM 89.3, she’s known for helping businesses unlock growth through smart space strategy.
📰 Featured in: Money FM 89.3, CNA, Biztech Asia, Singapore Business Review
📘 Author of Property Blueprint for Businesses
🎙 Follow Edith on LinkedIn
