According to a Savills report, the Dubai silk route strategy will boost demand for industrial real estate starting from the second half of 2019. The strategy is expected to encourage the ecommerce and third-party logistics sectors in the city.
The Savills report also highlighted how the Dubai silk route will play a key role in the creation of demand for warehousing facilities in Dubai.
Dubai’s industrial property sector witnessed a mismatch between the demand and supply in the first half of 2019.
Rent for Grade A properties declined by 4 to 6 percent whereas rent for Grade B properties declined by 4 to 6 percent during the first half of 2019, Construction Week Online reported.
James Lynch, Savills’ head of industrial and logistics told Construction Week Online that, “the transactions we have seen [in H1 2019] are towards spaces that have been built-to-suit and have a ‘flight to quality’ as organisations seek operational efficiencies through improved facilities.”
Dubai Silk Road strategy will enhance trade between free zones, UAE, and logistics service hubs such as DP World’s global locations and create demand for Dubai’s industrial and warehousing facilities.
HH Sheikh Hamdan bin Mohammed bin Rashid Al Maktoum, crown prince of Dubai and chairman of Dubai Executive Council gave his approval for the Dubai silk route strategy earlier in March.
The Dubai silk road strategy was prepared by the Ports, Customs and Free Zone Corporation (PCFC) in collaboration with key government entities.
In 2018, UAE and China signed a memorandum of understanding (MoU) concerning joint cooperation on The Belt and Road Initiative and the 21st Century Maritime Silk Road Initiative.