The UAE’s industrial and logistics space is increasingly attracting global investor interest, according to global real estate advisor JLL.
JLL said the recent sale-and-leaseback of Transworld Group’s logistics facility in Jebel Ali Free Zone, Dubai showcases positive investor sentiment and signals future growth in the sector.
The rise in e-commerce and subsequent digitisation of the supply chain industry are major factors fuelling growth and investor interest for high quality assets in the industrial logistics space, it added in a new report.
Abdul Kader Monla, director, Capital Markets in MENA, JLL, said: “In the long run increased capital investments of this scale will drive future development of quality space, fulfilling demand for warehouse facilities across the UAE.
“The logistics sector is attracting significant interest from institutional investors, asset managers, REITs and private family offices seeking long term returns that are backed by quality tenants while retaining little or no management responsibility for the real estate.”
JLL said it is currently advising a number of firms considering asset light strategies, allowing greater returns through reinvesting the sale proceeds into their core business.
When compared to traditional debt, alternative funding structures can allow for higher capital release while minimising cash outflow.
“We expect to see an increasing number of future trades given the unique value proposition and attractive attributes of the sector, particularly in today’s tight market conditions,” added Monla.
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