Smart warehouses to boost Jeddah’s retail investment


Modon, the Saudi Authority for Industrial Cities and Technology Zones, has signed an agreement to establish, develop, and operate 14 warehouses in various areas in Jeddah’s First Industrial City. A statement said that creating these warehouses is meant to boost the retail sector by providing quick packing solutions.

The warehouses based on smart, automated systems, will provide quick logistical solutions to retailers, which is expected to stimulate investment in the sector. It will provide support to industrialists and entrepreneurs as well.

According to Modon, the project involves the construction of fully digital and automated warehouses that do not need human intervention, using the latest technology and equipment that provides access to storage units via a smartphone app called ‘smart door locks.’

According to the authority, these warehouses will be operated based on the public-private sector partnership (PPP) model, and are expected to enhance quality standards and operational efficiency of services and products, and stimulate investment in industrial cities.

The statement added that the project will also offer a 24/7 customer service system that provides immediate and thorough support.

The First Industrial City was established in 1973 culminating in a total area of more than 12 million square meters. The city contains a wide range of industries and is a hub for logistics. Last year, rents for warehouses in the city jumped to more than 22 per cent, as the pandemic-driven boom in online retailing contributed to the higher demand for warehouse units. Boost in manufacturing units was also listed as a reason for the increase in demand for warehouses.

Jeddah is looking to cement its position as the Red Sea’s main commercial hub, and is at the forefront of development in Saudi Arabia. It is expected to develop $90 billion of real estate and infrastructure projects by 2030. The port city will get nearly 1.4 million square meters of retail space, along with 89,000 new homes and 250,000 square meters of office space.