{"id":671271,"date":"2025-09-03T00:00:00","date_gmt":"2025-09-03T00:00:00","guid":{"rendered":"https:\/\/enterpriseam.com\/egypt\/hardhats\/could-cold-storage-be-the-future-of-egypts-storage-industry\/"},"modified":"2025-09-03T00:00:00","modified_gmt":"2025-09-03T00:00:00","slug":"could-cold-storage-be-the-future-of-egypts-storage-industry","status":"publish","type":"hardhat","link":"https:\/\/enterpriseam.com\/egypt\/hardhats\/could-cold-storage-be-the-future-of-egypts-storage-industry\/","title":{"rendered":"Could cold storage be the future of Egypt\u2019s storage industry?"},"content":{"rendered":"

Unlike dry storage, Egypt\u2019s lesser-known cold storage sector is largely untapped \u2014 but <\/strong>how lucrative is it, exactly? <\/strong>Cold storage involves warehousing any commodities that are temperature sensitive, such as meds and perishables. EnterpriseAM sat down with engineer Ibrahim Bakir (LinkedIn<\/a>) to discuss his feasibility study<\/a> comparing the prospects of cold and dry storage in Egypt.<\/p>\n

(Tap or click the headline above to read this story with all of the links <\/strong>to our background as well as external sources.)<\/p>\n

What makes cold storage special?<\/strong> Cold storage offers investors something dry storage does not: mild competition, Bakir said. The steep costs associated with acquiring refrigerative and fire safety equipment act as a high barrier, in addition to the reliance on skilled labor and on-call maintenance duties \u2014 which sends prices soaring. These circumstances severely limit entrants into cold storage in any market, and Egypt is no exception.<\/p>\n

Fewer competitors allow cold storage lessors to charge suitable rent premiums<\/strong>, sufficiently offsetting the prodigious costs involved as well as yielding attractive bottom lines. Multinational corporations are among the clientele in cold storage, and tend to prefer leasing over owning warehousing facilities in Egypt, Bakir said. The resulting tenant pool is more than sufficient to reward investment in cold storage.<\/p>\n

Investors looking at real estate often dismiss cold storage warehousing as a complex <\/strong>and daunting business <\/strong>\u2014 in other words, a \u201chassle,\u201d Bakir said. Transforming an empty plot of land into a fully operational cold storage warehouse \u2014 and eventually into an Amazon-grade facility \u2014 could be accomplished in as little as two months with proper project management. Unlike other real estate options, cold storage need not be a long-term investment, yet retains its value.<\/p>\n

Egyptians tend to consider residential and commercial real estate the wiser gambit<\/strong>, but cold storage warehousing requires lower square footage, making it the more cost-effective solution. <\/p>\n

The proliferation of cold storage facilities in Egypt is inextricably linked to the nation\u2019s <\/strong>export ambitions for meds and perishables. <\/strong>Even though Egypt\u2019s exports in perishables are strong \u2014 growing 21% y-o-y in 2024 to a record USD 6.1 bn<\/a>, it does not regularly welcome new players entering to the scene, the same goes for meds exports. Established giants in Egyptian exports of perishables and meds are not expanding enough annually to promote commensurate investment in cold storage, Bakir said. This state of affairs is consistent throughout the MENA region, with Egypt and Morocco being relatively ahead of the curve.<\/p>\n

Where to invest? <\/strong>Bakir outlined that El Obour is by far the most suitable location, owing to its striking proximity to the fresh produce and fish retail market Souq el Obour \u2014 this facilitates connections between warehousing and clients. Other notable locations include Obour el Gedida, Tenth of Ramadan, Belbes, Sixth of October\u2019s Industrial Zone, and New Cairo\u2019s Industrial Zone.<\/p>\n

Indian players are also eyeing the sector<\/strong>, including chemicals player TCI Sanmar Chemicals who said earlier this year that it is planning a USD 300 mn investment push in Egypt<\/a> that will see the company invest in warehousing and cold storage projects among other things. In the same month, India\u2019s Lulu Group said it was planning an expansion of cold storage facilities during a meeting with the Investment Minister Hassan El Khatib, the Middle East Observer<\/a> reported. <\/p>\n

ICYMI-<\/strong> Egypt-based cold chain developer Sullex<\/a> announced it would develop the country\u2019s first<\/a>integrated city<\/a> for logistics, chilled, and frozen food industrial services back in February 2024. The smart temperature-controlled logistics city, dubbed Sullex-TRC, is set to have a USD 150 mn investment ticket and cover 510k sqm at a site in Giza. <\/p>\n

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