DAMMAM: The Saudi market is witnessing a rapid surge in demand for warehouses and storage space, as companies move to increase inventory levels as a precautionary measure against the impact of geopolitical tensions in the Gulf, which have disrupted transportation and supply chains in recent weeks.
This shift comes as key sectors such as food, petrochemicals, retail, and manufacturing rely on stable logistics flows, prompting companies to reassess their operational strategies and shift from just-in-time supply models to preemptive stockpiling to reduce potential risks.
Abdulaziz Al-Harbi, a supply chain consultant, said demand for warehouses in major cities — particularly in the Eastern Province and Riyadh — has risen significantly in recent periods, driven by increased demand for precautionary storage.
He noted that companies are now preferring to hold inventory sufficient for weeks or even months, rather than relying on regular supply flows that could be affected by regional developments.
He added that the Eastern Province’s proximity to key energy and trade corridors in the Gulf makes it particularly vulnerable to disruptions, explaining the rising demand for warehouses near ports and airports, especially those linked to King Abdulaziz Port in Dammam and King Fahd International Airport.
For his part, logistics investor Khaled Al-Shammari said the market is witnessing a qualitative shift in corporate behavior, where storage is no longer just an operational function but has become a risk management tool.
Al-Shammari noted that some companies have already begun signing long-term contracts to secure additional storage space, even amid rising prices.
He explained that current tensions in the Gulf, along with fluctuations in shipping activity and rising transportation costs, have pushed companies to “buy time through storage,” in an effort to ensure business continuity and avoid sudden supply disruptions.
These developments are reinforcing Saudi Arabia’s position as a regional logistics hub, particularly amid major government investments in infrastructure and supply chains under the objectives of Vision 2030.
At the same time, they are putting pressure on warehouse capacity and increasing competition for logistics assets.
With uncertainty persisting in the region, experts expect demand for warehouses to remain elevated in the coming period, as precautionary storage shifts from a temporary measure to a more permanent strategy among an increasing number of companies operating in Saudi Arabia.
