INDUSTRIAL BUILDINGS MARKET (Industrial Sector)

The Industrial Buildings Market is among the fastest growing markets in various areas of Tanzania, especially in regions with the relevant resources.For example, Dar Es Salaam, Pwani, Mwanza, Tanga, Mbeya, etc., have significant industrial growth.

GROWTH DRIVERS OF THE INDUSTRIAL SECTOR

• 1. RAPID POPULATION GROWTH. Tanzania is among the African nations with high population growth (3.1% per year).The large population leads to increased and extensive land use in the country.
• 2. URBANISATION. The growth rate of the urban population is over 5.9% (Urban population rose to 34.3% in 2020), and it is estimated that by 2040, the number of urban residents will exceed 50%. The main reason for urban growth is due to a large group of youth migrating from rural areas to towns (Rural–Urban Migration) in search of jobs and a better life, as well as starting families.Also, some rural areas are growing into small towns.All these factors contribute to increased land use.
• 3. INCREASING HUMAN ACTIVITIES.
  • A. SETTLEMENTS. The increase in population contributes significantly to the growth of settlements and land use.
  • B. COMMERCIAL INVESTMENT OVER VARIETY PROPERTIES. Construction of various buildings, especially investments in hospitality sector properties (tourism such as hotels), shops, high-rise buildings, guest houses, restaurants, entertainment & conference facilities.The construction of different types of buildings contributes to increased land use.
  • C. INFRASTRUCTURAL DEVELOPMENT. The government has invested in infrastructure development to attract investment.For example, the construction of tarmac roads to connect regions, cities, districts, and zones.Also, construction of bridges, bus terminals, the Bus Rapid Transit (BRT) system, the ongoing construction of the Standard Gauge Railway (SGR), and urban roads through the Tanzania Rural and Urban Roads Agency (TARURA), etc. This infrastructure has made various areas more accessible and facilitated housing development by reducing transportation costs, travel time, and improving access to construction materials, thereby increasing large-scale land use.
  • D. ADMINISTRATIVE AND POLITICAL ACTIVITIES. The growth of settlements and population, along with their economic or social activities, contributes to the expansion of administrative and political activities, such as:
    • i. Construction of leader’s offices.
    • ii. Construction of leader’s residences.
    • iii. Construction of political party offices.
    In Tanzania, the increase in the number of regions leads to the construction of various offices and increased land use.

KEY DRIVERS

• i. Increase in DEMAND – The rise in population contributes to the growth in demand for basic needs, starting from food, clothing, and various items for daily use.
• ii. Economic Growth – The increase in the number of middle- and high-income earners creates opportunities for various products, which contributes to economic prosperity. For example, in urban areas, people earn incomes sufficient to afford the purchase of different goods.

TEN (10) REGIONS / CITIES WITH MANY INDUSTRIES

• 1. Dar Es Salaam
• 2. Pwani / Kibaha
• 3. Mwanza
• 4. Tanga
• 5. Arusha
• 6. Mbeya
• 7. Iringa
• 8. Kilimanjaro / Moshi
• 9. Mtwara
• 10. Njombe

CHALLENGES IN THE INDUSTRIAL BUILDINGS MARKET

• 1. BUILDINGS REQUIRE LARGE SPACES – The industrial buildings market requires large areas for construction. The challenge is that urban areas have the necessary services for industrial operations but offer only limited space.
• 2. HIGH CONSTRUCTION & OPERATION COSTS – The construction of industrial buildings is expensive and requires substantial capital. Operating industrial buildings is also costly, including investments in machinery, energy, and raw materials for processing (manufacturing products).
• 3. URBAN PLANNING ISSUES – The construction of industrial buildings is highly affected by urban planning matters, where urban planning experts often designate industrial areas far from the city.

CONCLUSION

Tanzania is among the fastest-growing countries in Africa, with high demand for products, placing it in a strong position for continued growth.