Industrial Real Estate Boom in Jamaica
Jamaica's industrial real estate sector is now booming, with commercial facilities such as warehouses, manufacturing, distribution, and logistics centers proving robust. Indeed, the need for warehouse and logistics facilities is driven by several causes, including increased online shopping and inventory stockpiling. With many malls, restaurants, and retail outlets closed or operating on limited hours, and people fearful of getting infected with the virus, internet purchasing has increased. This is causing manufacturers and distributors to scurry for more warehouse capacity in order to stock up on goods to satisfy demand and so has raised the demand for the commercial properties for rent in Jamaica. The epidemic has also caused unprecedented disruption in global supply chains, making it difficult for manufacturers and merchants to obtain raw materials and completed items on time, if at all. In recent years, foreign interest in Jamaica's property market has increased. Foreign homebuyers are drawn to vacation houses in the Montego Bay region, Ocho Rios, and Negril. According to Nicola Delapenha of Coldwell Banker Jamaica, interest in Port Antonio is gradually increasing due to airport development in the vicinity.
The Shift in Demand for Industrial Real Estate It is widely acknowledged that these shifts have increased both short- and long-term demand for industrial real estate properties, allowing companies to better serve their customers, bring outsourced production or products closer to their customer base, and expand into new markets
to capitalize on opportunities. According to NCB Cap Market, "demand for industrial real estate is expanding as retailers, manufacturers, distributors, and logistics firms increase their capacity to accommodate larger inventory levels of raw materials, in-demand consumer items, and more." Its impact on commercial real estate is divided into two markets. While demand for some commercial buildings, such as warehouses, manufacturing, distribution, and logistics centers, has remained strong, demand for others, such as hotels and corporate offices, has decreased slightly. This has occurred as corporations adopt remote work and lower their demand for office space, while the hotel industry continues to suffer from a drop in tourism. The current boom in industrial real estate in Jamaica is not unique to the island; it is occurring in many other nations as well. This is evidenced by recent research conducted by Jones Lang LaSalle (JLL) Incorporated, a multinational commercial real estate services business headquartered in the United Kingdom with offices in 80 countries.
Study showing strong take-up warehouse space According to CBRE Research2, $1 billion in new e-commerce sales produces 1.25 million square feet of warehouse space demand. Furthermore, it is estimated that e-commerce sales alone would climb by $1.5 trillion over the next five years, necessitating 138 square meters of new logistics or warehouse space worldwide to support the expansion of e-commerce sales. This will increase new building, which is already at an all-time high. This demand may raise industrial property prices and rental rates, increasing the return on investment for commercial real estate owners.
Conclusion: There is a huge opportunity in the industry of Jamaican real estate and one should really move forward with the idea of making an investment in Jamaica.