Cold storage yields have compressed but remain 100–200 bps above dry warehouse in most markets, driven by supply-demand imbalance and specialised operating requirements.
Typical CAPEX/pallet
USD 2,500 – 5,500
Occupancy in prime markets
88 – 96%
Typical unlevered IRR
9 – 14%
Development lead time
14 – 24 months
Investment thesis
Structural undersupply in emerging markets (Africa, South Asia, LATAM).
Modern facilities enjoy pricing premium for GDP, retail and export tenants.
Automation reduces labor exposure and opens 3PL contracts.
Key risks
Refrigerant obsolescence — HFC phase-down can strand assets.
Energy price volatility (mitigated by solar + heat recovery).
Single-tenant concentration.
FAQ
Is speculative cold storage bankable?
Rarely. Most lenders require 50–70% pre-lease. Development finance and ECAs can bridge greenfield with strategic sponsors.
Which markets are the highest priority?
Nigeria, Kenya, Saudi Arabia, UAE, India, Vietnam, Brazil — combining growing demand, low modern-stock ratios and improving power infrastructure.
