MANILA – The coronavirus disease 2019 (Covid-19) pandemic has accelerated the demand for spaces in the industrial and logistics sector with the need for more warehouses for vaccines, and the growing e-commerce sector.
KMC Savills chief operating officer Cha Carbonell said Thursday that demand for highly specialized cold storage facilities is seen to post a 15 percent compound annual growth rate.
“Even before the pandemic hit, we knew that this asset class would grow due to the increasing availability of e-commerce platforms and the convenience it’s bringing to our daily lives. What Covid did is just to accelerate this demand for the sector,” Carbonell said during KMC Savills 2021 PH Real Estate: Property Trends and Outlook.
She said investment pledges for the transportation and storage sector surged from PHP3.9 billion in 2019 to PHP37.5 billion last year based on data from the Philippine Statistics Authority.
But the challenge for the country is to convert these pledges into actual investments as the country is also competing with neighboring nations, Carbonell said.
She said a more accommodating business environment and a competitive electricity cost are a few of the challenges that the government needs to address to encourage more investments in the industrial and logistics sector.
She added there is also a demand and supply imbalance in the storage spaces, with demand concentrating in Metro Manila while the majority of the supply is in South Luzon.
Carbonell cited that the current demand for storage spaces in Metro Manila is at 63 percent, but available supply is only at 14 percent.
On the other hand, there is a high vacancy rate for storage spaces in South Luzon with available supply at 69 percent compared to the 17 percent demand.
Demand in North Luzon is at 11 percent while supply is at 14 percent.
The KMC Savills executive added that most of the warehouses are in South Luzon due to the proximity to ports, availability of trucks, well-built roads, and shorter travel time to and from the National Capital Region.
On the other hand, more warehouses are forecasted in North Luzon with its proximity to the Clark International Airport and the new Manila international airport that will be located in Bulacan, Carbonell added.
“Hopefully, the industry catches up,” she said. (PNA)
