Thailand Industrial MarketView Q1 2019
04 Jul 2019
Modern Logistics Properties Hit Their Lowest Vacancy Rate in Five Years at 12.7%
In Q1 2019, the Manufacturing Production Index (MPI) improved from the previous quarter but dropped 1.1% Y-o-Y compared to the MPI in Q1 2018. The Thai Industrial Sentiment Index (TISI) continued to rise in Q1 2019 to 96.3, up from 90.7 in the same period last year, with the 3-month forward TISI at 104.2. Additionally, the Industrial Capacity Utilization Index (ICU) increased to 71.3% from 68.4% in the previous quarter, according to the data reported by major developers in CBRE’s survey basket.
The Modern Logistics Properties (MLPs) sector showed signs of improvement in Q1 2019, with the total supply continuing to increase and reaching 3.66 million sq. m., while the vacancy rate has dropped to the lowest point in five years at 12.7%.
The demand for MLPs also grew by 16.1% Y-o-Y and the total net absorption in Q1 2019 alone was more than half of the total net absorption for the whole year of 2018. The growing demand for MLPs was mainly driven by the logistics sector serving the increase in e-commerce companies following the global trend.
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