With a multi-billion dollar investment to develop its warehousing and transportation parks in the United Arab Emirates, Abu Dhabi Airports Company (ADAC) is preparing to take the logistics industry by storm.

Although the development of logistics parks in the United Arab Emirates has traditionally focused on Dubai, a string of multi-billion dollar projects have recently been launched in other parts of the country. Leading the revolution has been Abu Dhabi Airports Company (ADAC), a regional powerhouse in the aviation sector with management responsibility for the airports in Abu Dhabi and Al Ain.

The centrepiece of ADAC’s US$6.8 billion development strategy is Abu Dhabi Airport Business Park, which is being constructed on 12 square kilometres of land and will include around 2 square kilometres of space for a warehousing and transportation complex. The project has received a considerable amount of interest from the logistics sector, especially from freight forwarders, importers, exporters and MRO specialists – proving that demand for such developments outside of Dubai is also plentiful.

“Abu Dhabi Logistics Park will offer a wide range of facilities, from light industrial units in a variety of designs to commercial offices and plots of land for tailored developments,” explains His Excellency Khalifa Mohamed Al Mazrouei, chairman of ADAC.

“The project is being developed in two phases, which means we can make improvements to the masterplan in line with investor requirements. Construction of phase one has already commenced and should be completed in 2010. The development of phase two is scheduled for 2011 and will be completed in 2015,” he adds.

Since expectations have already been exceeded in terms of demand, ADAC has opened an investor services centre for the logistics park, which Al Mazrouei has described as a ‘one stop shop’ for region and international companies that want to establish their operations in the development.

“This will alleviate the need for investors to visit a range of different government entities for their documentation and paperwork,” he states. “The centre will enable a unified interface for all business services, including assistance with business registration, sponsorship, licensing and leasing.”

Understanding the need to simplify the various procedures for potential tenants, ADAC has been working in close partnership with government bodies such as the Department of Economic Development, Abu Dhabi Chamber of Commerce, Ministry of Labour, Immigration Department and Abu Dhabi Customs, which have all collaborated to ensure the services centre has the relevant infrastructure in place to support investors.

“We recently signed an agreement with the Department of Economic Development to streamline systems and data sharing, which will also greatly increase the speed of licences being issued. Similarly, Abu Dhabi Chamber of Commerce has installed its integrated system at ADAC’s premises to ensure an immediate manifesting and processing of requests,”says Al Mazrouei.

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The logistics park is a central component in a large-scale development plan for Abu Dhabi International Airport, which has been designed to increase the overall capacity to more than 20 million passengers per year. This includes the construction of a second runway and third terminal, which have been completed, together with a midfield terminal complex and air control tower (ATC), which will be operation in the next few years. Of course, with growing volumes of cargo being handled at the airport, its airfreight facilities will also receive an industrial makeover.

“The amount of cargo being handled at Abu Dhabi International Airport has strengthened this year and we expect this trend to continue in the future, especially with the ambitious plans to diversify Abu Dhabi’s economy in the coming years,” says Al Mazrouei. “In response, a world-class airfreight facility will be opened by 2012, expanding our current handling capacity of 475,000 tonnes per annum to 1 million tonnes per annum. In the longer-term, this figure will eventually reach 3 million tonnes.”

Showing his excitement for the project, Al Mazrouei explains the cargo facility will be equipped with fully-automated handling systems and the latest in technology systems, offering complete integration between airlines, forwarders, government departments, banks and other stakeholders. “This combination will provide speed of service that is second to none,” he states with a smile.

Although the market response for these developments has been described as “overwhelming”, this has actually presented an interim problem for Al Mazrouei and his team. “Being the emirate’s first airport logistics park, we have attracted huge demand from industry players in countries such as Germany, France, Italy and the United Kingdom, not to mention the Middle East,” he says. “However, demand for space has exceeded the facilities that we have planned. ADAC has responded to this issue by announcing a second logistics park at Al Ain International Airport at this year’s Paris Air Show.”

The additional project, which is being developed in partnership with Helios SinoGulf Development, will cover 650,000m2. The first phase is scheduled for completion towards the end of 2010 at a cost of $250 million.

“Whilst the two projects are separate with different unique selling points, they complement each other and together provide the full suite of facilities that are needed to meet the demands of the aviation and aerospace industries,” says Al Mazrouei. “Within both of these logistics parks, international investors can run their operations in the best business environment, benefiting from the low cost operation at Al Ain to focus on manufacturing aircraft parts and the growing connectivity network offered by Abu Dhabi, which is the perfect solution for the distribution of goods.”

It’s difficult to fault the ambitions of ADAC. However, with the market still recovering from a global recession, critics question the timing of these ventures. However, Al Mazrouei is happy to address such concerns and remains confident that a short-term downturn will not impact the long-term future of his logistics parks.

“Despite the current economic situation, the Middle East is an expanding market for the aviation and aerospace sectors, due to its strategic geographical location and growing economic strength. Projections show the region will continue its strong growth and Abu Dhabi will progress the diversification of its economy,” he concludes. “The aerospace and aviation sectors are a key component of this diversification, and are poised for tremendous growth in the emirate. With this growth comes need for high quality specialist facilities, and we are confident there is demand to support our developments.”

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