China not alone in warehousing needs

A building boom is underway across Asia – warehouses. While much of the focus has been on China thanks to the recent IPO filings from Alibaba and, warehousing projects are being announced almost on a daily basis across the region.

For example, Ticon Logistics Park (Tpark), created by Ticon Industrial Connection Plc in 2005, announced plans to invest Bt6bn this year to build more local logistical facilities and warehouses in Myanmar. According to the company, “We have focused on developing logistics parks and warehouses at three strategic locations, which are close to sea ports such as Laem Chabang to serve import-export customers, close to industrial estates, such as Amata, Hemaraj and Rojana, to serve manufacturers in the estates, and close to the prime locations where distribution centres have been established, such as at Wang Noi and Bang Plee.” By the end of this year, Tpark will have total warehouse space available for lease of 1.32m sq m.

Also taking advantage of outsourcing trends, Damco and Vietnamese warehouse owner HTM opened a new warehouse in North Vietnam to support fashion/ retail customers whose sourcing patterns are centered there. The long-term HTM – Damco partnership is anticipated to create more than 20,000 sq m of warehousing space in Vietnam over the next three years.

Meanwhile, Singapore has seen much activity with Menlo Worldwide Logistics recently announcing the opening of its 50,000 sq m Benoi facility. This facility brings the total count to 8 in Singapore with a combined 219,700 sq m.

DHL Supply Chain recently announced plans for a facility in Singapore’s Tampines LogisPark. It is expected to increase DHL Supply Chain’s warehouse capacity in Singapore by 40% and will serve DHL’s regional customers in the aerospace, health care and technology sectors.

Indonesia, however, which is considered to have great growth potential, has struggled in recent years with a declining economy. Rather open the country fully to foreign investment; it has instead restricted foreign ownership of infrastructure needs such as warehousing and cold storage, limiting investment to 33%. The result of this could prove costly for this promising country.

While China’s domestic market attracts an amazing amount of investment to build and modernise warehouses to support its e-commerce boom, the rest of Asia is also seeing increasing demand for warehousing – some to support outsourcing while others support growing intra-regional needs.