India's Grade A Warehousing Market Set to Boom with 45 Mn Sq Ft Leasing in 2024
India's Grade A warehousing market is witnessing an unprecedented boom, driven primarily by key regions such as the Mumbai Metropolitan Region (MMR), Pune, and NCR, which collectively account for 64% of the total demand.
Warehousing MarketGrade A WarehousingLogisticsIndustrial SectorsCredaiCre MatrixReal Estate PuneOct 04, 2024
The report also revealed that the warehousing demand/leasing of 20.3 MSF in H1 2024 far surpassed new supply, which stood at 14.8 MSF. The segment also recorded the lowest ever vacancy rate of 8.2% - demonstrating the industry's sharp trajectory.The rapid growth is driven primarily by key regions such as the Mumbai Metropolitan Region (MMR), Pune, and NCR, which collectively account for 64% of the total demand. Pune has seen extremely high demand for Grade A warehousing space, contributing significantly to overall demand in the market.
Despite a surge in demand, Pune faces a supply shortage, with the demand-to-supply ratio hitting 2x, indicating the potential for significant new development in the coming quarters. Similarly, Chennai registered a demand-to-supply ratio of 1.6x, highlighting the increasing attractiveness of its logistics infrastructure.
With a vacancy rate of just 7.4%, the city is poised to maintain its upward trajectory as more industries look to establish a presence in this vital southern market. This also indicates the region's emerging role as a logistics and manufacturing hub.
Due to the aforementioned gap between the burgeoning demand for high-quality warehousing, the warehousing rental rates in H1 2024 also increased at 4% YoY, across the country. The persistent demand is primarily driven by Third-party logistics, Manufacturing, and Electronics sectors accounting for nearly two-thirds of the demand for Grade A spaces. India's Grade A warehousing stock is projected to surpass 300 MSF by 2025 - which currently stands at 238.5 MSF, providing a promising outlook for stakeholders.
Frequently Asked Questions
What is driving the growth of India's Grade A warehousing market?
The growth of India's Grade A warehousing market is driven primarily by key regions such as the Mumbai Metropolitan Region (MMR), Pune, and NCR, which collectively account for 64% of the total demand.
What is the projected leasing of premium warehousing spaces in 2024?
According to a report by CREDAI and CRE Matrix, leasing of premium warehousing spaces is set to cross 45 million Square Feet in 2024.
What is the current vacancy rate in the Grade A warehousing market?
The segment recorded the lowest ever vacancy rate of 8.2% in H1 2024.
Which sectors are driving the demand for Grade A warehousing spaces?
The persistent demand is primarily driven by Third-party logistics, Manufacturing, and Electronics sectors accounting for nearly two-thirds of the demand for Grade A spaces.
What is the projected growth of India's Grade A warehousing stock by 2025?
India's Grade A warehousing stock is projected to surpass 300 MSF by 2025, which currently stands at 238.5 MSF.
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