Bahrain Review

Majaal boosting local economy

Al Arrayed: giving warehousing a new meaning

Majaal Warehouse Co, a wholly owned subsidiary of Kuwait’s First Bahrain Real Estate Company, is now home to more than 60 SMEs with a majority of businesses run by Bahrainis.

The hub prides itself in its flexible operations including facilities management, conducting of feasibility studies and supervision of development and construction.

A key success of Majaal is the contract it won to develop and manage the scheme of Kuwait’s Al Mazaya Holding Company at Majaal’s hub at the Bahrain Investment Wharf (BIW) in Prince Salman Industrial City.

“We see Majaal as a catalyst for new development and innovation within the warehousing sector. We’re not just providing space anymore; we have been approached by multi-nationals looking for solutions as well as investors and land owners who are interested in our business model,” said Amin Al Arrayed, Majaal’s managing director.

“We are much more strategic and are also incentivising land owners to develop similar developments.

“We are actively providing facilities and lease management services to Mazaya and hence working with around 15 of their tenants. In addition to that ongoing mandate, we are receiving requests from other regional investors to actively develop, manage, and lease their land.”

Majaal’s model could be replicated in other GCC states before long

Majaal’s model could be replicated in other GCC states before long

Majaal’s gross rental income was BD1.29 million ($3.42 million) in 2014, growing from BD753,369 in the
previous year.

The key driver to maintain is that it has been operating at full occupancy for the last four years and two-thirds of its lease contracts are with major tenants who have long-term renewable contracts.

“We are actively managing around 30 tenants plus Mazaya’s 15. We are also working closely with government entities in directing foreign direct investment as well as contributing to the local economy,” said Al Arrayed.

“While there has been overall competitiveness and weakness in the economy, we remain confident of the need for grade A warehousing as existing businesses relocate to BIW for greater efficiency, superior infrastructure, and access to key transportation and logistics hubs.”

A company statement said: “Majaal’s business model has always been based on growth within Bahrain and the surrounding GCC countries; our brand is trademarked across the GCC which will only ease the process of expansion and growth in the future. We support our tenants whenever we can; a number of them are production units and we always try to support them by hiring their services.

“We are very positive about the growth of Majaal. New businesses and SMEs are always starting up in Bahrain and the GCC and all these businesses need flexible-space with easy access at a secure location. Majaal has a unique offering with value-added services developed specifically to cater to the SME sector and we have no doubt that this will only succeed in attracting more businesses in
the future.”

The statement added: “Majaal was established during the hard times in Bahrain, facing both the financial and political crisis between 2008 and 2012. In the face of all that we went through as a business that was just starting up, we addressed a niche that was not being served and hence were at full occupancy by 2011.”