Mangaf Fire Triggers Major Overhaul In Kuwait's Real Estate Sector

The tragic Mangaf fire has compelled both the government and the private sector in Kuwait to undertake a significant reorganization of the real estate landscape, particularly affecting "Bachelor Accommodation" and storage facilities. This systematic overhaul is expected to bring about fundamental changes, leading to higher costs for storage and housing rentals for labor, which in turn will drive up tender prices due to the need for improved quality and increased operational expenses.

The Mangaf fire has already caused a notable surge in rents for warehouses and bachelor’s buildings, with prices escalating rapidly. Further increases are anticipated unless new storage spaces and residential alternatives are introduced to maintain high standards of security and safety and to eliminate housing chaos. The government has adopted a stricter stance on random warehouses, enforcing penalties on violators.

Real estate experts warn that property dealers will face significant challenges, especially those who have rented out apartments as warehouses without proper supervision. This problem is worsened by unauthorized alterations to engineering spaces that contravene municipal licenses.

In the aftermath of the tragedy, warehouse rental prices have surged by 40 percent, with projections of a 100 percent increase if the state fails to provide legal storage alternatives for investors using illegal building basements. This situation could lead to higher prices for goods and merchandise, impacting consumers.

Informed sources revealed that store rental prices vary based on the type of activity. For example, in areas like Shuwaikh, Al-Rai, and Al-Ardiya, stores dedicated to food ranged between 4 and 7 dinars per square meter before the Mangaf fire, with areas spanning 500 to 1,000 meters. They also highlighted the difficulty of finding small, individual spaces in these regions, while car warehouse prices ranged between 1.25 and 1.5 dinars per square meter.

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