New Delhi, October 25
The Industrial & Logistics (I&L) sector in India witnessed a remarkable 48 per cent quarter-on-quarter increase in leasing activity during July-September 2024, according to CBRE report.
New Delhi [India], October 25 (ANI): The Industrial & Logistics (I&L) sector in India witnessed a remarkable 48 per cent quarter-on-quarter increase in leasing activity during July-September 2024, according to CBRE report.
The total absorption across India's top eight cities reached 11.4 million sq. ft., up from 7.7 million sq. ft. in the previous quarter. Delhi-NCR, Kolkata, and Hyderabad emerged as key contributors, accounting for 65 per cent of the total leasing volume.
Delhi-NCR led the market with 3.4 million sq. ft. of leasing activity, followed by Kolkata (2.4 million sq. ft.) and Hyderabad (1.7 million sq. ft.). Other cities such as Bengaluru (1.5 million sq. ft.), Mumbai (0.9 million sq. ft.), Chennai (0.7 million sq. ft.), Pune (0.5 million sq. ft.), and Ahmedabad (0.4 million sq. ft.) also saw considerable leasing activity, with a combined total of 9.6 million sq. ft. of new supply hitting the market during the quarter.
From January to September 2024, I&L leasing across the top eight cities totalled 27.5 million sq. ft., with Delhi-NCR, Kolkata, and Bengaluru accounting for 61 per cent of the activity, recording 16.9 million sq. ft. in combined leasing.
The third-party logistics (3PL) sector dominated leasing with a 38 per cent share, reflecting the growing trend of companies outsourcing their storage and distribution capabilities to enhance efficiency.
The engineering and manufacturing sector followed with a 19 per cent share, while retail, e-commerce, and fast-moving consumer goods (FMCG) accounted for 17 per cent, 10 per cent, and 6 per cent of leasing activity, respectively.
Domestic corporations led the charge in leasing activity, capturing an 82 per cent share, a notable increase from 67 per cent in Q3 2023. This was followed by companies from the Asia-Pacific (APAC) region at 9 per cent and the Europe, Middle East, and Africa (EMEA) regions at 6 per cent.
Select micro-markets saw significant rental growth during the quarter. Mumbai's Bhiwandi (NH-3) led the way with an 11 per cent increase, followed by Ahmedabad's Bavla and Sanand areas, which recorded rental growth of 10 per cent and 8 per cent, respectively.
In Delhi-NCR, Ghaziabad (NH-24, 58, 91) witnessed a 7 per cent increase, while Chennai's Western Corridor 2 and Pune's Pimpri-Chinchwad each saw rental rates climb by 5 per cent.
New supply was largely concentrated in Chennai, Bengaluru, and Delhi-NCR, which accounted for 50 per cent of building completions, underscoring their importance as key hubs in the I&L sector.
Looking ahead, emerging markets such as Chandigarh, Hosur, Jaipur, Lucknow, and Vizag are projected to become focal points for warehousing expansion, driven by occupiers' efforts to extend their distribution networks to Tier-II and Tier-III cities. This move aims to optimize operational costs and provide closer access to larger populations.
Anshuman Magazine, Chairman and CEO - India, South-East Asia, Middle East & Africa, CBRE, said, "We expect an increase in the warehousing leasing activity in the upcoming quarters, fuelled by new enquiries, the introduction of high-quality supply, and the culmination of pending transactions," he added.