Dubai Industrial Market 2019

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Increase in vacancy levels and rental pressures observed across most micro-markets

Market sentiment across the industrial and warehousing micro-markets in the city remain subdued, a trend which has carried through from 2018. Oversupply in select locations and a limited number of new market entrants to drive fresh demand, were among the key factors for the sluggish market activity.

Transactions reflected a mix of build-to-suit demand, both expansion and consolidation exercises and ‘flight-to-quality’ requirements. Transaction closures were observed for small-to-medium sized space ranging from 10,000 sq. ft. to 30,000 sq. ft., however, limited transactional activity was recorded in the 50,000 sq. ft. and above segment. Renewal activity on the other hand increased as landlords became flexible on rental expectations and lease terms in a bid to compete with the newly completed supply.

E-commerce brands were the primary new occupiers of warehousing space and were closely followed by 3PL (Third Party Logistics) companies that have been expanding their presence in Dubai to service clients from pharmaceutical, retail and e-commerce sectors. However, demand from manufacturing companies, retail operators and other sectors remained limited.


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