First ever logistics parks to be built in Kenya
Africa Logistics Properties (ALP) has announced the launch of Kenya’s first ever grade logistics and distribution parks for the international and local occupier rental market in order to improve the supply chain infrastructure in the country.
The company announced two land purchases situated in the North and West outskirts of Nairobi, unveiling the purchase of 22 acres at Tatu City, in Ruiru, and 49 acres from Tilisi, towards Limuru.
The two warehouse parks will offer international standard warehousing to multinational and local regional companies in the logistics, retail, light industrial, and e-commerce sectors.
Kenya is among many African nations suffering losses on inadequate warehousing facilities, with the cost of moving goods in Africa estimated to be up to three times higher than in developed countries, accounting for as much as 75 per cent of retail prices.
“Economic development in Africa now rests significantly on the development of modern grade A industrial and logistics warehouses, which we are moving to build across targeted African capital cities, beginning with Nairobi,” said of ALP.
Selman observed that they have now started construction at the Tatu site, while the construction of infrastructure and road junctions at their western Nairobi site is due to commence in the coming months.
The design specifications for the ALP warehouses conform to international building standards. “Once complete, the units will also be managed to international property management standards by ALP’s team,’ said Selman.
“At Tatu City, ALP will be creating 50,000 sq. of grade A warehouse space, to be called ALP North. It has, this month, also agreed terms with an international company for the park’s first rental lease, for 14,000 sq. of warehousing, in Kenya’s largest industrial lease to date.” he added.
The distribution parks are expected to create to create up to 500 jobs in each of its new warehousing parks.
According to him, each warehouse will provide raised loading bays, 12m high operating eaves, large column grids of 12 x 24 metres, high load capacity, laser levelled flooring together with large high capacity truck yards and parking.
“These specifications enable operators to store up to eight pallets vertically, leading to lower storage costs and overall higher operating inefficiencies,” said Selman.
Occupier service charges will also be lower than traditional ‘go downs’, thanks to environmental features such as solar power – with mains and generator back up – and rainwater harvesting.
Other institutional investors include Maris, a Nairobi based private investment business focused on sub-Saharan Africa, and Mbuyu Capital Partners, and an African focused UK based asset manager.
The scale and speed of the investor engagement has been driven by the expected economic impact of ALP’s investments and the ALP’s team deep sector experience and execution capability.
“ALP helps to drive down logistical costs by providing grade-A warehousing facilities that deliver built-for-purpose supply chain infrastructure,” said Selman in a press statement sent to newsrooms.
This infrastructure will create inefficiencies that should lead to lower prices for consumers. It will also help both international and local companies to focus on their core business growth instead of having to construct, finance, manage, and maintain warehouses on their own.
ALP’s management team has 40 year experience in developing modern warehousing across emerging markets, having previously built 1.5 million square metres of modern warehousing across Eastern Europe.
By Alice Gworo