Although the fundamentals are positive, the highly specialised sector means a relatively shallower pool of occupiers, ranging from food and beverage producers to pharmaceutical companies.

Technical specifications for these facilities differ significantly from standard L&I facilities in areas such as the building structure, clearance and floor loading, air-conditioning and fire suppression, and power provision.

For instance, concrete construction in cold storage facilities needs to be reinforced for better sealing and to limit condensation. Facilities that store goods at extremely low temperatures may also require more advanced airlock compressors and fire suppression systems.

These unique features contribute to higher capital expenditure (CapEx) and, over time, higher operating expenses (OpEx) for maintenance.

Another factor that investors need to be aware of are operational issues such as additional health and safety training, which is often mandatory for workers operating in sub-zero temperatures. This is compounded by the relatively tight labour markets in many countries at present.

Take a pharmaceutical cold chain facility, where there must be on-site pharmaceutical technicians to handle storage of goods, and compliance officers to monitor adherence to pharmaceutical regulations and guidelines. This is in addition to technicians handling the maintenance, repair, and troubleshooting of refrigeration systems.

To complicate the challenge, investors and operators face the additional hurdle of navigating varying local regulations in different markets when building and maintaining these assets.

For established investors, these heightened barriers to entry work in their favour to limit competition. Meanwhile, newcomers face an uphill battle to adapt and get up to speed in the sector.