Chengdu Logistics Report

Wednesday, January 7, 2009 0:09
Posted in category China Logistics

Just before the holidays Jones Lange LaSalle released their most recent report, Post-earthquake Chengdu Logistics Infrastructure Facilities Report.

Leaving little room for guesses with the title, the report is heavily focused on warehousing conditions within the city – some of which were damaged during the 5.12 earthquake.

With Chengdu’s role becoming more important at the national level, one key tenant of this plan has been to develop its logistics capabilities. A point made by clear by a government official I spoke with last year:

Chengdu is playing a very important role in logistics of Southwest China. Early in 80s of last century, Chengdu was designated by the State Council as the “Three Centers and two hubs” which is “Center of Science and Technology, Center of Commerce and Trade, Center of Finance, Hubs of Transportation and Communication”.

To fulfill this dream, JLL’s report goes a long way to show the efforts and investments that are being made in the warehousing sector.

When reading through the report, make sure to look at figure 4: Warehouse Stock and Vacancy Rate.  It shows a very interesting picture (1) 2009 and 2010 will have a lot of stock that comes online (2) the increase in stock initially will greatly exceed demand (3) by 2011, the investments will begin to pay off

According to JLL.

Overall, the report is well done and presents a picture that investors would probably be wise to understand – over supply is not good for investors – and consider what the impact of a prolonged recession will be on the environment

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