Investment
Cold Storage Investment
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.