Demand for ready-built factories in Thailand rises despite stagnating supply

Net absorption reached 113,193 sqm in H1.

According to a Knight Frank report, in the first half of 2025, the Ready-Built Factory (RBF) market in Thailand did not increase, resulting in a total supply remaining unchanged from previous levels. The decline in new RBFs inventory means that many developers are taking a cautious approach by constructing only when they have secured tenants for the upcoming projects.

“Demand remained consistent despite the stagnation, resulting in a slight increase in the occupancy rate. In addition, more manufacturers are shifting towards purchasing SILP to build and operate their factories, rather than leasing RBF,” the report added.

Here’s more from Knight Frank:

Leasing activity for RBFs continued to rise in H1 2025, with total occupied space reaching 3,157,165 sq m. This reflects a positive net absorption of 113,193.6 sq m this half-year. This can partly be attributed to the tensions from busting tenants and continued influx of export-oriented manufacturers.

The overall market occupancy rate rose to 96.2%, indicating sustained interest and a tightening of availability across key industrial zones. Regionally, the Eastern Economic Corridor (EEC) continued to outperform with a near-full occupancy rate of 98.73%, followed by the Central Region at 94.08% and the Bangkok Metropolitan Region (BMR) at 93.51%. With no new supply added in H1, the consistent rise in occupancy signals a well-balanced market. However, it's crucial to remain vigilant, as factory operations data indicate a decline in new factory openings, which could impact the long-term health of Thailand's industrial property sector.