Roads upgrade, robust trade drive investments in goods storage facilities
An Express Kenya truck in Nairobi. Roads upgrade and rapid growth of e-commerce have raised demand for warehouses across the country. FILE PHOTO | NATION MEDIA GROUP
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Ongoing upgrade of roads and rapid growth of e-commerce are pushing up demand for warehousing facilities across the country, logistics industry players say.
Jumia Kenya managing director Parinaz Firozi projects that e-commerce will continue to spur growth of warehousing facilities in the country.
Thika is attracting export companies as it is easily accessible through the Eastern Bypass from Ruiru roundabout and is linked through the same by-pass to Jomo Kenyatta International Airport.
The ongoing upgrade of roads and rapid growth of e-commerce are pushing up demand for warehousing facilities across the country, logistics industry players say.
Logistical firms Jumia and Express Kenya as well as property developers like AMS Properties and Erdemann Properties are among the firms that have rolled up their sleeves to cash in on the rising opportunities as Kenya continues to adopt e-commerce platforms.
Jumia Kenya managing director Parinaz Firozi projects that e-commerce will continue to spur growth of warehousing facilities in the country.
“As companies continue to set base in Kenya and expand to other areas, there is a possibility that we shall see more companies adopting warehouses,” said Ms Firozi.
“As Jumia continues to grow in double digits and to expand to other cities in Kenya, there is no doubt we shall require more space and personnel. Judging from the rapid growth, this could happen very soon, in a few months.”
Global property consultant Knight Frank in its first quarter report for the Kenyan market released early in the year said there was demand for prime warehousing facility in the market.
Property developers like AMS Properties and Erdemann Properties are among those easing business in industrial real estate by building godowns.
Erdermann has 15-unit godowns on 120,000 square feet while AMS Properties which has been concentrating on residential developments is constructing 48 warehouses on Mombasa Road.
Although investors like Alpha, Erdermann and AMS Properties have identified Mombasa Road as a favourable location for warehouses, market watchers are seeing a new shift in choice of location.
Export companies are taking an interest in Thika, a trading town in Kiambu. Thika is easily accessible through the Eastern Bypass from Ruiru roundabout and is linked through the same by-pass to Jomo Kenyatta International Airport. This accessibility is what is making Thika attractive to investors.
Some traders want to avoid driving through the city centre with cargo just to get to warehouses in Industrial Area or to Mombasa Road because of traffic. They would rather use the Eastern Bypass to Thika and proceed to the airport from there.
But Industrial Area also attracts clients because of its proximity to the airport and the highway. The completion of the 26-kilometre Northern Bypass will bring relief to businesses that have warehouses in this area.
The Eastern Bypass links Ruiru, Kiambu and Kangudo roads near the airport. It is a 39- kilometre stretch while the Northern Bypass links Limuru Road to Thika Road.
Bollore Africa Logistics Kenya commercial director Gaurav Gupta, in an earlier interview with the Business Daily, cited outsourcing of non-core activities to supply-chain partners to maximise efficiency as another reason driving demand for warehouses.
Bollore and Express Kenya are some of the biggest warehousing business and logistic companies operating in Kenya.
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