Industrial and warehousing leasing activity across the top five cities – Chennai, Mumbai, Delhi NCR, Pune, and Bengaluru– remained buoyant during the first quarter of 2024 at 7 million square feet, with Mumbai and Chennai leading the demand with about 55% share, according to professional services and investment management company Colliers.
Around 33% of the new Grade A developments in the first quarter were concentrated in Delhi NCR, the Colliers report asserted.
Interestingly, leasing in Chennai, especially remained robust, with industrial and warehousing space take-up in January-March 2024 almost twice the leasing activity in the corresponding period of last year.
Across the top five cities, Bhiwandi in Mumbai with 1.7 million sq ft of Grade A demand, was the most active market for Q1 2024. Bhiwandi was followed by Oragadam in Chennai, which surpassed the leasing activity of Chakan Talegoan in Pune for the first time in a while.
Third-party logistics players continued to be the top occupiers of industrial and warehousing space, contributing to over 40% in the total warehousing demand. The third-party logistics space uptake was driven by healthy activity in Chennai particularly.
The city accounted for about 43% of the overall activity in the top five cities.
At the Pan-India level, retail players accounted for 16% of the demand during the quarter, followed by engineering and automobile players with 12% share each.
“This signifies changing consumption patterns and hints at opportunities emerging in the sector from the steady demand diversification,” said Vijay Ganesh, Managing Director, Industrial and Logistics Services, Colliers India.
Coming to leasing by e-commerce players, Colliers said this ever-booming segment has seen robust growth post Covid-19 and witnessed 2.3X times leasing during January-March 2024 compared to the same period in 2023.
With increased focus on digital infrastructure and changing consumption patterns, e-commerce segment is further likely to warm up and create more demand for warehouses.
Moreover, the rise of quick-commerce players is also likely to catalyse demand for bigger hub-warehouses.
“Overall, an upbeat start to the year holds potential to translate into a healthy performance by the industrial & warehousing sector in 2024,” said Vimal Nadar, Senior Director and Head of Research, Colliers India.
