New space requirements in Africa up 13% Q/Q

New warehousing and logistics requirements in Africa have been on the rise, with a 13% increase in the second quarter of 2021, particularly in key markets like Nairobi, as reported by Knight Frank. Tilda Mwai, Senior Analyst for Africa at Knight Frank, provided insights on the changing landscape of warehousing in Africa during a recent interview with CNBC Africa. Mwai highlighted the shift from traditional warehousing facilities to more purpose-built and internationally developed spaces in recent years. This transformation has been fueled by a growing demand driven by factors such as inclusive economic growth, infrastructure development, and government policies aimed at attracting investors and promoting SME growth. The second quarter of 2021 showed a notable surge in demand, indicating a rebound from the pandemic-induced downturn. Key drivers for this increase include a return to business confidence as countries ease lockdown restrictions and reopen for economic activities. Regions like Nairobi have showcased robust recovery, with prime rents in the city hitting record highs. Nairobi's success can be attributed to its responsiveness to the need for purpose-built warehousing, improved ease of doing business, and strategic positioning as a gateway to East Africa. The city has witnessed significant infrastructure development, aligning with the surge in warehousing supply and demand. The sectors propelling this demand include agriculture and retail, with e-commerce emerging as a significant driver for warehousing growth. E-commerce's expanding footprint is reshaping the warehouse sector and fueling the need for modern, efficient storage facilities. Overall, the rise in purpose-built warehousing across Africa reflects a broader trend towards modernizing logistics infrastructure to support economic growth and enhance competitiveness on the global stage. As the continent continues to attract investment and foster business-friendly environments, the demand for specialized warehousing solutions is expected to remain strong.