Home / Knowledge / News / E-commerce / Dubai set to be Middle East hub for e-com: Savills

Dubai set to be Middle East hub for e-com: Savills

29
Jan '20
Pic: Shutterstock
Pic: Shutterstock
E-commerce is the top sector driving demand for warehousing sector in Dubai, followed by engineering and manufacturing along with third-party logistics (3PL), according to global real estate consultancy Savills, whose Dubai Industrial Market report for 2019 second half released recently found there is a renewed focus on sustainable development across the sector.

“After a prolonged period of subdued demand levels throughout 2018, industrial and warehousing space witnessed a strong increase in market activity on the back of a spike in renewal, relocation and consolidation exercises. Most of these transactions that were under discussion over the last few quarters and were completed during H2 2019 on account of proactive measures implemented by the government such as reducing fees for business incorporation, relaxing FDI norms, among others,” Murray Strang, head of Dubai office at Savills, said in a press release.

A healthy mix of small, medium and large sized transactions were observed across most micro-markets. The majority of the demand was concentrated across locations like Dubai South, Jebel Ali Free Zone Authority (JAFZA), Dubai Investments Park (DIP) and National Industrial Park (NIP).

Demand drivers across these micro-markets varied depending on various factors like the nature of the business and warehousing specifications.

The emergence of new concepts such as ‘cloud kitchens’ and ‘vertical farming’ has also had a positive impact on warehousing demand in the city. Occupiers from the food and beverage sector and select 3PL companies that service the domestic market continue to display a preference for Al Quoz due to its central location.

While JAFZA remained the prime venue for engineering and manufacturing businesses, Dubai South emerged as arguably the preferred location for e-commerce companies and 3PL players during 2019.

During the second half of 2019, close to 350,000 sq ft of warehousing space was leased across Dubai South by government entities, international e-commerce companies and automotive spare part manufacturers among other firms. More than 750,000 sq. ft. of land was also leased on a long-term basis across Dubai South, making it one of the most active industrial and warehousing markets during the period.

DIP and JAFZA were among the other key markets to witness strong demand during the review period. In DIP, new leases (accounting for 70 per cent share of total transactions) and renewals summed up the 200,000 sq ft of transaction activity concluded by the industrial experts at Savills.

Out of the 12 key warehousing and industrial micro-markets in Dubai, rental correction was observed across only five micro-markets when compared to H1 2019 while they have remained stable across all the other locations.

Landlords are anticipated to remain flexible around lease terms and rental rates in 2020. This will continue to support demand for good quality stock in the city. Demand is likely to remain strong from existing sectors and emerging industries, the report said.

Fibre2Fashion News Desk (DS)


Must ReadView All

Fibre2Fashion: 21 years of serving textile-apparel-fashion industry

Textiles | On 17th Apr 2021

Fibre2Fashion: 21 years of serving textile-apparel-fashion industry

Fibre2Fashion, the online platform for the global...

Pic: Shutterstock

Textiles | On 17th Apr 2021

China's economy grows 18.3% in Q1 2021

Powered by a strong domestic and foreign demand, China's economy grew ...

Pic: Shutterstock

Retail | On 17th Apr 2021

US retail sales saw strong rebound in March: NRF

As government cheques fattened consumers’ bank accounts and more...

Interviews View All

International apparel brands, Head honchos

International apparel brands
Head honchos

Launched first collection at onset of Covid

Textile Industry, Head honchos

Textile Industry
Head honchos

Blockchains will be in heavy use by early adopters by 2025

Footwear Industry, Footwear Retailers

Footwear Industry
Footwear Retailers

Still struggling to mop up higher sales

Ujjval Saraf,

Ujjval Saraf

Founded by Jimmy Lai, Giordano International Ltd, a Hong Kong based...

Dhruv Toshniwal & Udit Toshniwal,

Dhruv Toshniwal & Udit Toshniwal

Launched a year ago, Fashions Pvt Limited conceptualises and sees D2C...

Chendhuran Sundar,

Chendhuran Sundar

Headquartered at Singapore, Crocodile is a global fashion and lifestyle...

Andreas Lukas, Andritz Nonwoven

Andreas Lukas
Andritz Nonwoven

With forces in engineering and process development, Andritz Nonwoven...

Michael Jaenecke, Messe Frankfurt

Michael Jaenecke
Messe Frankfurt

From May 14 to 17, international exhibitors will present the entire...

Madison Maxey, Loomia

Madison Maxey
Loomia

Loomia designs and manufactures soft circuit systems that can be produced...

Sandeep Gonsalves & Sarah Gonsalves, Sarah & Sandeep

Sandeep Gonsalves & Sarah Gonsalves
Sarah & Sandeep

Established in 2012, Sarah & Sandeep is a luxury menswear label...

Ramya Rao & Kavea R Chavali, Kalaneca

Ramya Rao & Kavea R Chavali
Kalaneca

<div>The journey of Kalaneca (kala-Art, Neca- Nikaah) formally began in...

Megha Kumari & Jigar Mali, Label Megha & Jigar

Megha Kumari & Jigar Mali
Label Megha & Jigar

New Delhi based label Megha &amp; Jigar blends India's unique handcrafts...

Press Release

Press Release

Letter to Editor

Letter to Editor

RSS Feed

RSS Feed

Submit your press release on


editorial@fibre2fashion.com

Letter To Editor






(Max. 8000 char.)

Search Companies





SEARCH

Leave your Comments


April 2021

Subscribe today and get the latest update on Textiles, Fashion, Apparel and so on.


Advanced Search