Tilisi Developments Limited has opened sales for land parcels with ready-made infrastructure and paperwork for buyers to put up warehousing facilities, as studies show warehousing in such short supply in Kenya that the gap is curbing GDP growth, seeing as much as a third of agricultural output wasted, hurting the health system, and curbing the development of the country’s retail and manufacturing
Tilisi is one of the first developers to move to offer such a product in the country, setting aside 86 acres of its 400-acre master-planned development for warehousing and repackaging facilities and providing all the supporting infrastructure for the site along the Nairobi- Nakuru highway and less than 10 minutes away from both the Northern and Southern bypasses.
The estate is providing access roads, water and electricity supplies, ICT connections, sewage connections, matatu stops, street lighting, solid waste transfer stations, and parks and eating facilities for the warehouse staff, meaning investors only purchase the land and erect the warehousing sheds, a process the World Bank estimates can be done within months.
The move to open the way to a rapid increase in easily accessible warehousing facilities comes at a time when the National Cereals and Produce Board is able to handle less than 10 per cent of the maize produced in the country, due to a shortfall in storage capacity, according to the Agriculture Cabinet Secretary Felix Kosgey. As a result, Kenya loses up to 30 per cent of its maize harvest a year and suffers repeated maize shortages. The dairy industry is likewise prone to wastage in times of milk gluts, due to inadequate storage facilities, as is almost the entire agricultural sector, which loses:
– About 35 per cent of fish catch due to poor storage, according to Kiplagat, J, Wang R and Li,T, Renewable and Sustainable Energy Review 15, 2960-2973
– $100m a year to ruined flowers due to poor storage, according to Lennane A, 2013, Loadstar, 2013
– 30 per cent of harvested mangoes on inadequate storage, according to ACET, in Pathways to Transformation, African Centre for Economic Transformation, 2012
– Two thirds of potential earnings from avocados, according to WEForum, Enabling Trade Forum Valuation to Action, 2014
The lack of sufficient,quality storage space has also had an impact on the pharmaceuticals industry, with the shortage of quality storage causing unsafe materials to be distributed, according to the Kenya Medical Supplies Agency.
“The increased growth in various sectors of Kenya’s economy and in the country’s population has not been met by a growth in the availability of quality warehousing to support and sustain them. What we are currently experiencing is demand vastly outstripping supply,” said Kavit Shah, co-CEO of Tilisi Developments Limited.
The Kenyan manufacturing industry is also poised for forth generating expanded warehousing needs, with a growth rate of 6 per cent in 2015, 6.6 per cent in 2016 and 7 per cent in 2017, forecast by the World Bank. This is expected to put further strain on existing storage facility and increase demand for quality warehousing units to adapt to market needs, with warehousing a critical element in supply chain management.
Currently, despite being a leading investment destination in Africa, Kenya trails Mauritius, Namibia and South Africa in the availability of in-demand cold storage facility, according to the most recent annual Global Cold Storage report.
In bridging the gap between supply and demand in terms of numbers and quality warehousing units, Tilisi is providing best in class infrastructure, providing an alternative to the limited supply of traditional storage spaces in the increasingly congested Nairobi.
“Many companies have no business without achieving storage space in Nairobi, but are constrained by the options available in the city, many of which do not meet their specifications. Because we understand the vital role that logistics play in development and GDP growth, we are modeling our development to facilitate their operations,” said RaneeNanji, co-CEO of Tilisi.
Strategically located in Limuru, Tilisi is investing amounts that go into the billions to support infrastructure for its master planned development, 30 minutes from Nairobi’s Central Business District.
“Our clients and potential customers recognize that the warehousing and storage market is lacking quality and number of units across many industries in Kenya. They have identified that storage facilities and being located within efficient logistics parks are now key to our national economic takeoff” said Ranee Nanji.