UAE's warehouse market set for growth

The demand for warehouses is growing exponentially in the UAE as the popularity of e-commerce and online shopping continues to increase, experts said.
Despite the increase in demand, however, the supply for storage space in the country remains low, according to global real estate services and investment firm, CBRE.
Saleh Abdullah Lootah, CEO of Lootah Real Estate Development, and developer of Senaeyat, the UAE's first lease-to-own industrial warehouses, online shopping transactions in the region and in the UAE have been increasing by double-digits year on year, which in turn creates more interests for warehousing.
Lootah said: "All over the world, e-commerce has been driving the expansion in the warehouse leasing market. This is evident in the UAE, which enjoys the world's highest mobile penetration, high purchasing power per capita and large consumer spending. All these factors result in a huge demand for warehouses, which are also interchangeably called fulfilment centres, today. However, the warehouse inventory in the UAE has not been catching up with this upward trend. The Senaeyat project will strongly contribute to the growth of UAE's industrial and logistics ecosystem by providing cost-effective options for businesses without compromising excellence. As an affordable industrial partner, Senaeyat empowers businesses to own warehouses over a period of only 10 years and convert rental expense to property asset.
UK-based consultancy firm, Business Monitor International (BMI), puts the average annual online spend per person in the UAE at around $300, more than three times than Saudi Arabia's $90 and France's $94. Visa recently reported that payment volumes in the Mena region surged by 44 per cent in 2018 over the previous year. The UAE's e-commerce market is estimated to be worth $27.1 billion by 2022, a report from Admitad MENA shows. According to 2019 Agility Emerging Market Index, the UAE is among the top three emerging markets in the world for logistics after China and India and ranks first in the region. The country's logistics markets have also benefitted greatly from investments in physical infrastructure, earning as much as $30 billion (Dh110 billion).
- business@khaleejtimes.com