Ayesha Saba

As the businesses expand in new locations, the secondary cities can drive Pakistan’s economic growth. With the right policies and infrastructure, this shift can ease pressure on major cities and promote regional economic balance.

In a conversation with WealthPK, Hammad Ali, a real estate analyst at Abdullah Associates and Builders, said Pakistan’s commercial real estate sector had witnessed a significant shift in recent years, with developers and investors increasingly turning their attention to the secondary cities. This trend, driven by urbanization, economic diversification, and infrastructure development, is reshaping the real estate landscape beyond the traditional hubs of Karachi, Lahore, and Islamabad.

According to him, this expansion is not just a temporary phenomenon but a strategic response to the growing demand for commercial spaces in smaller cities, which are emerging as new centers of economic activity. “Cities like Faisalabad, Gujranwala, Multan, Peshawar, and Hyderabad are experiencing population growth, as people migrate there from rural areas for better employment opportunities and improved living standards.

This influx has created a demand for modern commercial infrastructure, including office spaces, retail outlets, and warehouses,” he maintained. He said the role of infrastructure development, particularly under the CPEC, had been instrumental in this trend. Expansion of highways, expressways, and special economic zones (SEZs) has made these cities more accessible, reducing logistical challenges that previously deterred investment.

The industrial estates in Faisalabad and Multan, for instance, are attracting commercial projects ranging from shopping malls to corporate offices. Talking to WealthPK, Khaliq Ahmed, Urban Development Specialist at the Local Government and Community Department (LGCD), said historically, Pakistan’s economy had been heavily reliant on agriculture and a few major industries concentrated in large cities. However, the recent years have seen a push toward diversifying the economic base, with the secondary cities playing a pivotal role.

For instance, Faisalabad, often referred to as the “Manchester of Pakistan,” has long been a hub for the textile industry. Now, it is also attracting investments in IT, logistics, and manufacturing. Similarly, cities like Sialkot and Gujranwala are gaining recognition for their export-oriented industries, including sports goods and ceramics. This economic diversification has created a need for modern commercial real estate to support these growing industries, he said.

However, he cautioned that the regulatory environment in these cities was still evolving, and inconsistent urban planning could pose hurdles for the developers. Furthermore, the investors require greater policy incentives, such as tax breaks and streamlined approval processes, to ensure sustainable growth. “The government must facilitate commercial development through improved zoning laws, infrastructure incentives, and financial support for real the estate projects in secondary cities,” Ahmed suggested.

Credit: INP-WealthPk