Garment boom raises rents

An increase in garment manufacturing and demand for storage space is pushing up rental prices on industrial land.

“Rents in industrial zones that host garment manufacturing and goods storage are up,” Myanmar Real Estate Services Association vice chair U Than Oo told The Myanmar Times this week.

“It’s happening in nearly all zones. The rental prices range from K2 million to K15 million a month depending on plot size, road condition and water and electricity supply. Unlike residential property, industrial zones are limited.”

Among the garment factory industrial zones where rents are rising are Hlaing Tharyar and Shwe Pyi Thar, which offer easy access to labour. For renters in search of storage space, the Mingalardone, and East Dagon industrial zones offer convenient transport links. Rents are also up in the Myaung Dagar industrial zone, which offers storage facilities for iron and steel materials.

A 50-to-100 square foot plot in Dagon Seikan township costs around K20 million to buy, while a plot with a warehouse in Hlaing Tharyar industrial zone is priced at around K800 million. Industrial plots that are conveniently located are attracting interest from buyers, but with land prices rising sellers are not keen to let the land go, U Than Oo said.

As a result, sales of industrial plots in East Dagon, South Dagon and Dagon Seikkan townships have slowed. But this has raised demand for rents and rental prices, which for warehouse facilities now range from K6 million to K12 million a month, depending on size, said Daw Nilar Kyaw, owner of Aye Yeik San real estate agency in East Dagon industrial zone.

“Most land transactions are rent,” she said, but added that the rising land prices was also making buyers, not just sellers, reluctant to purchase land outright.

Source: Myanmar Times

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