Mumbai: Industrial and warehousing leasing between January and September 2022 has observed nine per cent increase on a year-on-year basis, claimed Colliers India in its latest report released on Tuesday.
The statement issued by Colliers, a global property services company read, "During January–September 2022, industrial and warehousing demand witnessed 9 per cent rise on a YoY basis with a total gross absorption of 17.5 million square feet across the top five cities (Bengaluru, Chennai, Pune, Delhi NCR and Mumbai) in India."
Third-party logistics players (3PLs) continue to be the largest warehousing occupiers, accounting for more than half of total warehousing demand to date.
Improved retail market sentiment amidst the festive season and higher online spending continue to support warehousing growth and is expected to add to short-term demand addition, as demand remained resilient during the third quarter as well, at 6.7 mn sq ft, the highest since Q1 2021.
"India’s warehousing sector is gradually picking up pace with massive growth in third party logistics. 3PL players contributed to half of the total warehousing demand during YTD2022 with an average deal size of 1.1 lakh sq ft. About 75 percent of the leasing by 3PL was through large-sized deals," said Vimal Nadar, Senior Director, Colliers India.
YTD Delhi accounts 39%, Pune accounts 21 per cent of leasing demands
YTD 2022, Delhi-NCR accounted for 39 per cent of total leasing demand, with Pune accounting for 21 per cent of total leasing demand, fueled by strong demand from 3PL, engineering, and e-commerce players. Tauru Road and Luhari remained the most active micro-markets in Delhi-NCR, while Chakan-Talegaon continued to attract industrial occupiers in Pune.
New supply fell by 20 per cent year on year during YTD2022, to 15 million square feet, as developers remained cost-conscious while waiting for input pricing to fall further, causing project completions to be delayed. Rents are likely to firm up in the next few quarters across preferred micro markets in key cities owing to strong demand and limited availability of quality supply.
"Continued leasing momentum is expected in the warehousing segment with various retail clients in active discussion to consolidate their footprints in large-sized mega distribution centres. Large deals will continue to drive the warehousing market as e-commerce and 3PL players plan remarkable expansion to enhance efficiency," said Shyam Arumugam, Managing Director, Industrial & Logistics Services, Colliers India.
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