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Warehouse & logistics’ trends to dominate 2020

Logistic Dubai Harbour
Cityscape Intelligence looks at the top trends shaping the 2020 UAE property landscape

Covid-19

The short-term impact on global economic growth is undeniable, with those countries that are the most advanced in the outbreak already feeling the effects.

According to experts, the immediate hit to demand has been very evident in the retail and hospitality sectors, certain industries are more susceptible to the disruption of supply chains. Disruption has already started in sectors such as automotive, aviation, chemicals and consumer goods, and the full effects have yet to filter through. Conversely, pharmaceuticals and healthcare are most likely to experience a surge in demand. 

In the UAE, real estate consultant Savills says that the introduction of a stimulus package by the Central Bank will be a shot-in-the-arm to the property market in the medium-to-long term.

A new form of retail  

With the decline of the traditional retail sector, the industry is looking at ways to reinvent itself by introducing more innovative activations. A creative solution for empty storefronts that’s popular today is curating spaces for interactive store museums, a place where shoppers can interact with the art/exhibition and document/advertise it on social media, thus drawing more footprint and traffic into malls.

The rise of warehouse and logistics’ space

According to Cavendish Maxwell, the decline in retail is giving rise to e-commerce and warehouse and logistics space. As a result, more companies are using their current stores as storage spaces for their online retail and products.

According to Cavendish Maxwell, authorities including JAFZA, Dubai South, and DAFZA have developed schemes and are working with relevant government departments, such as Dubai Customs, to support e-commerce business growth, eliminate red tape and enable easier access to the local market.

Urban vibrancy & student housing

This also enables universities to benefit from a higher number of enrollments, local and international, as housing is not limited to the on-campus facilities available.

Experts maintain that the current market demands more than basic living requirements, such as liveliness, sense of community, walkable retail experiences; areas that encapsulate the idea of live-work-play.

The amenities of a gym, pool, courtyard, or storage are no longer a luxury or perk, as every listing or housing offers the same. Thus, investing into communities with high urban vibrancy need is essential in order to attract the right market and meet their needs.

An investment opportunity that is synonymous with urban vibrancy is student housing. Millennials have a strong sense of community, and that is something they seek when looking into a potential housing opportunity. Thus, a housing investment that provides them with all necessary amenities, as well as living and employment opportunities is exactly the kind of university experience they seek.

The development of student housing projects has gained the attention of investors and governments alike. It is an untapped market that the UAE, specifically Sharjah, is investing heavily in. The Nest by Arada in Aljada, located near University City, is the first student housing initiative of its kind in the UAE. Scheduled to be completed and handed over by 2021, it enables parents, universities, and investors to provide students with an all-inclusive community and living space off-campus.

Sustainability

Sustainability continues to be a priority of government and companies across the world.

Rise of vertical farming in the GCC, more specifically in UAE, has resulted in a higher need for farming real estate and tech, attracting investors locally, regionally, and globally.

Vertical farming, which uses various technologies such as hydroponics is a new investment project for the UAE government as it works towards its mission to battle climate change, reduce its carbon footprint, and become a more sustainable and independent nation.

The technology claims to reduce water usage for farming by 90%. The UAE aims to deliver 12 vertical farming farms by 2021, increasing the need for farming real estate and investment due to its fast-approaching delivery period.

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