Chong Xin Wei
Changes follow review intended to accommodate increasing demand from operators such as Lock+Store and StorHub; alternative sites identified for self-storage use
SOME self-storage operators may have to move out of their current locations when their leases run out, following a lengthy review by JTC on the use of industrial land for the self-storage business.
The affected operators are those occupying sites zoned Business 2 (B2) for heavy manufacturing activities, as well as those in some Business 1 (B1) sites in the core zones. Core areas refer to those which JTC is prioritising for industrial use. These include Boon Keng, Toa Payoh and Ang Mo Kio.
Currently, there are about 20 existing sites in these core areas being occupied by self-storage operators, said JTC in a media briefing on Friday (Jan 24).
The Business Times understands that the total gross floor area occupied by storage operators in JTC industrial spaces spans more than 400,000 square metres.
“These sites can continue operating without changes following the lifting of the moratorium, and JTC will have further discussions with the respective operators on the continued use of such sites for self-storage, based on Singapore’s industrial needs,” said the statutory board.
Some operators are occupying leasehold sites they acquired in the past with active leases up to 2056, while others have leases expiring in a few years’ time. To minimise disruption, they will be allowed to continue operating at existing facilities until their leases expire.
JTC review
The impending moves follow a nearly four-year JTC review to accommodate increasing demand from the self-storage operators, amid limited industrial land in Singapore needed to support manufacturing activities. Operators such as Lock+Store and StorHub offer space for consumers to store items, including wine, collectibles and furniture.
JTC said that the operators have the option to operate on both commercial and industrial-zoned land.
During the review, a moratorium was imposed in late 2021 on requests for self-storage use on JTC industrial land. This will be lifted on Apr 1.
JTC had called for a review to look at the impact of self-storage on industrial land and balance the increasing demand from self-storage operators amid Singapore’s scarce industrial land reserved for manufacturing.
JTC land is primarily meant for manufacturing activities, said the authority, which added that it conducts “periodic reviews of policies” on the use of its industrial land and space in line with “evolving business and industrial landscapes”.
In light of the rising demand from self-storage players, JTC conducted the review to “ascertain the impact on our industrial estates”. This was amid the limited industrial land in Singapore to support manufacturing activities and ensure the adequacy of such land to support the needs of the manufacturing sector, it said.
JTC has identified several areas around Singapore, including sites in Bishan, Clementi, Tampines and Woodlands, for potential conversion of industrial properties to self-storage use.
“To prioritise and ensure sufficient industrial land for future manufacturing use, self-storage use may only be considered Business 1 (B1) sites, outside core areas reserved for industrial uses,” it said.
B2 sites will not be supported for self-storage use in view of high demand for such spaces, it added.
JTC did not clarify if sites zoned for B2 industrial uses were cheaper than those zoned for B1 uses.
Sites zoned for B1 use are generally for clean and light industrial uses. Examples of such businesses include electronic packaging and light manufacturing works.
All existing self-storage facilities on JTC industrial land will be allowed to continue operations until the end of their current lease or sublet terms, said JTC.
It also said it will further discuss the future of such sites with existing operators, and remain open to allow the continuation of such activities, subject to future industrial planning needs.
Self-storage operators previously told BT that JTC had started looking into the industry in 2021. While no actions were taken against them then, the operators said JTC’s review threw a spanner in the works for their expansion plans.
During the briefing, however, JTC pointed out that operators have options beyond JTC sites, including those on commercial and private industrial-zoned land.
Helen Ng, chairman of the Self Storage Association Asia (SSAA), said: “The growth of the industry will be contingent on the surrounding conditions accompanying the lifting of the development moratorium that was announced today.”
But in an interview with BT, she pointed out that while JTC said that it has “identified some zones close to housing estates” for potential conversion to self-storage use, operators are still uncertain about the definition of core and non-core areas.
When asked if there was a possibility of raising storage rates for households and microbusinesses that increasingly rely on self-storage to manage their operating costs, she said: “If supply is limited, there will be an impact on pricing for everyone – be it for end-users and us.”
For now, Ng said the operators will go over the information provided by JTC and will reach out to the statutory board again for more engagements.
Jes Johansen, SSAA’s president of the Singapore chapter, also told BT that the operators are hoping for “greater transparency and certainty”.
“We seek a reasonable degree of certainty on costs of doing business, understanding that priorities change over time. It is important for storage operators to offer cost-efficient solutions to the public,” he said.
JTC said it will remain open to dialogues with operators regarding potential acquisitions or relocations. The statutory board also noted that it conducts assessments on land use regularly.
The overall occupancy rate of JTC’s industrial space is 89 per cent in 2024, unchanged from the previous quarter and year.
“JTC’s master plan is to optimise industrial land usage to meet Singapore’s economic needs. It is critical to ensure that we have sufficient land to support Singapore’s economic growth,” it added.
Clarification: JTC has clarified that in its statements, no explicit mention was made in relation to the need for existing self-storage users to move. It emphasised that further engagement was needed for continuity, and does not have any definite outcomes after leases expire, whether in 2050 or in a few years.