Indian Economy News

Industrial and warehousing demand rose to 7.2 million square feet in Q1 2023: Report

According to a recent report by Colliers India, the top five cities' industrial and warehousing demand remained high during the first quarter (Q1) of 2023, increasing by 11% year-over-year (YoY) to 7.2 million square feet. This growth was primarily caused by the absorption of third-party logistics (3PLs) and the Fast Moving Consumer Goods (FMCG) industry. In addition, the first quarter also saw the highest leasing compared to the previous eight quarters.

During the quarter, 3PL operators constituted 41% of the total leasing activity and FMCG constituted 12%. The average deal size by 3PL operators in Mumbai was more than 2 lakh square feet (69% more than the pan-India average).

Moreover, the demand from retail and FMCG sectors witnessed a three-fold increase YoY as they expanded in larger markets like Delhi-NCR and Mumbai.

First-quarter leasing demand was driven by Delhi-NCR, which accounted for 29% of the total. Mumbai came in second with 25%. Leasing in Mumbai increased by 37%, driven primarily by 3PL operators. According to the report, Bhiwandi in Mumbai and Tauru Road and National Highway (NH) 48 in Delhi-NCR both continued to be attractive marketplaces during the quarter.

Furthermore, it was reported that deals larger than 1 lakh square feet accounted for around 80% of the demand in Q1 2023. The largest share of major deals was held by 3PL firms, followed by FMCG and engineering firms.

Disclaimer: This information has been collected through secondary research and IBEF is not responsible for any errors in the same.