Egypt’s local warehousing market is forecast to grow at 7% y-o-y over the next five years amid rising demand driven by new industrial zones and expanding e-commerce operations, according to a statement (pdf) from Egyptian Global Logistics (EGL).

The local market already leads the region in overall market value, but ranks third after Saudi Arabia and the UAE in terms of growth rates, EGL Marketing and Contracts Manager Mohamed El Kady told EnterpriseAM. While not leading the region in terms of growth, Egypt’s booming e-commerce sector, solid industrial base, growing tech sector, and strategic geographic position continue to “drive robust warehousing and logistics growth,” he added.

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Egypt currently has around 1.8k large warehouses and an additional 25k medium and small facilities scattered nationwide, according to estimates from EGL.

Many of the new warehousing facilities are smarter and more efficient than before. Across key warehousing zones — namely Cairo, Giza, Alexandria, Ain Sokhna, and around the Suez Canal — modern facilities are becoming increasingly technology-driven. This includes the integration of automation, robotics, AI-powered warehouse management systems, and IoT-enabled sensors, which “are transforming efficiency, visibility, and cost control,” El Kady said.

Logistic park builders are also responding to demand for more eco-friendly and sustainable warehousing, with projects like Yanmu East Logistics Park — a JV between Hassan Allam Utilities and Kuwait’s Agility Logistics Park — securing EDGE Advanced certification for its warehouses. Three of the park’s warehouses have achieved the certification with savings of 49% in energy, 53% in water, and 59% in carbon emissions, giving warehouse occupants cheaper running costs and boasting rights to a greener supply chain, which can be important leverage in financing and other negotiations.

The logistics sector is also expanding into new areas outside of traditional hubs. EGL identified Tarboul Industrial City in the Eastern Desert south of Cairo as an agricultural logistics and trade hub for Upper Egypt that benefits from its proximity to Cairo and the Suez Canal. The company also views Al Dabba Industrial City on the North Coast as a promising zone that will serve as a logistics anchor for the new under-construction cities like Ras El Hekma in the area — drawing on the UAE’s “Jebel Ali-style model,” EGL said.

Like other warehousing companies, EGL is expanding “aggressively,” with investments in some 350k sqm of warehousing capacity across Egypt’s logistics hubs in Alexandra, Dekheila, Sokhna, Abu Rawash, and Safaga.

LOOKING AHEAD-

Regional demand could be the next growth driver for our warehouse market amid rising costs and shortages elsewhere. For example, UAE warehouse rents are projected to rise between 5-10% this year amid heightened demand paired with shortages of vacant warehouses and industrial land. With its strategic location, cheaper labor and facilities, and an abundance of land resources, Egypt is well-positioned to attract UAE-based players with global operations seeking more affordable and available options.

But to bring companies’ warehousing operations over to Egypt, the infrastructure needs to be put in place. While Egypt imposes “no legislative barriers to foreign logistics operators in warehousing,” infrastructure availability is still a “primary challenge, [which] the government has prioritized to resolve,” El Kady told us. “Dated road, port, and transportation infrastructure” was also highlighted as one of three major obstacles for advancing the promising warehouses sector in Egypt, according to Agility.

Egypt also needs to focus more on integrating warehouses with advanced technology — known in the business as Grade A warehouses — Agility says. The report stresses that this would play an essential role in propelling the expansion of our warehouse sector and competitiveness in the region.

To this end, the government has committed some EGP 14 bn to develop seven state-of-the-art storage complexes — spanning around 1.3 mn sqm — dedicated to storing strategic commodities, according to EGL.

“Complex regulations and customs procedures” are also holding back the sector, according to Agility. To address this, the Finance Ministry finalized new amendments in June related to customs facilitation measures, seeking to reduce customs clearance time to two days from eight in the initial phase, which could take 9-12 months. Eventually, clearance could happen within hours.

Your top infrastructure stories for the week:

  • The SCZone signed a USD 4.2 mn agreement with an Egyptian-Turkish consortium to establish logistics project Sigma Egypt. The venture will develop two 50k sqm customs bonded yards in West Qantara and Ain Sokhna for container storage, handling, and repair.
  • The Suez Canal Authority is partnering with South Korea’s Hyundai Corporation to develop the Port Said Shipyard and set up a Port Fouad extension to build eco-friendly vessels and recycle ship scraps.
  • Egypt plans to boost its electricity interconnection capacity to 3.9 GW by the end of 2026, up from 790 MW last year, a government source told EnterpriseAM. The increase will be backed by the completion of multiple regional interconnection projects.
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