Out of the box

The secret of integration and exchange of benefits between the industrial and real estate sectors

Ismail Al Hammadi

August 16, 2022

The "Make in the UAE" forum was recently concluded with the signing of a set of partnerships and agreements aimed at consolidating the foundations of the industrial sector in the country, which has become the focus of greater attention during the recent period, to enhance its position within the list of approved economic sectors for the post-oil phase.

The industrial strategy adopted by the government to enhance its role in strengthening the economy, which aims to raise the contribution of the industrial sector to the total non-oil exports in the country, will have a role in stimulating the industrial real estate market and increasing the demand for it in the industrial and free zones that provide rare advantages for investors.

There are 47 specialized industrial zones in the UAE, characterized by special locations near sea, air and land ports, and huge logistical facilities, supported by advanced infrastructure that provides integrated solutions for manufacturers, companies and investors.

Statistics indicate that about 220 new factories entered work during the past year, with expectations that more new factories will enter this year, in light of the competitive advantages that the industrial sector has become in the country.

Entering a new factory means occupying a real estate, but rather a group of real estate, starting from the manufacturing unit to warehouses to workers’ housing, which means creating a kind of integration and enhancing benefit and exchange of benefits between the industrial sector and the real estate sector.

In light of the government’s efforts to intensify work and cooperation with local partners to implement the strategic objectives of the industrial sector and its growth, improve its performance and production, and enhance its competitive advantages to grant all investors and industrialists to benefit from it to achieve their investment ambitions in the country, this means that the demand during the coming stages will be great for industrial real estate of all kinds.

Here, the real estate guidance phase enters to enhance the national strategy for industry, where land prices and industrial real estate rents must be within the reach of the needs of investors and companies in all industrial areas in the country, which is considered a real gain for the industrial real estate sector in the medium and long term, and contributes to the development of attracting investments. Foreign direct, which, in turn, contributes to raising the demand for industrial lands.

The truth is that there is a discrepancy in the market at present in the prices of industrial lands, in particular, that do not converge or equal with the prices of lands in other regions, which makes the balance tilt in one region at the expense of another.

Just as these prices do not serve investors, they do not serve the industrial area in which they are located and are not in the interest of the industrial sector in general, which calls for reconsideration and prioritization to be compatible with the future goals of the industrial sector.

Industrial real estate prices play a major role in the success of the industrial sector plan. It also has a major role in raising the level of real estate sector activity as well. This requires finding a balanced equation for the parties to achieve this. Industrial real estate is one of the secrets of integration and exchange of benefits between the real estate and industrial sectors.

• «Industrial real estate prices play a major role in the success of the industry, and they also have a role in raising the level of real estate sector activity».

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