Pan-India warehousing demand has outgrown supply by 1.4x in January-June, with rents up 10%
- IBEF
- September 22, 2023
According to a CREDAI-CRE Matrix analysis, demand for warehouse space has increased by 1.4 times to 13 million square feet during the first half of 2023 (January-June), outpacing supply by an average of 10%.
The Indian Grade-A Warehousing stock reached 163 million square feet with a 9.4 million square foot supply addition during this period due to significant industrial growth and the creation of one of the fastest-growing real estate segments in the nation.
In contrast to the sectoral demand, which was driven by businesses situated in the Mumbai Metropolitan Region (MMR) and Pune, nearly half of the new warehousing supply during this time period was created in the MMR and the National Capital Region (NCR).
As per Mr. Boman Irani, President, CREDAI, the need for and supply of Grade A warehouses will continue to rise in the years to come as a result of the expansion of e-commerce, retail, and the influx of global businesses into India. He said, “Indian real estate as an industry possesses extremely strong fundamentals, reflecting macro and micro economic growth.”
Furthermore, Mr. Abhishek Gupta, the Chief Executive Officer of CRE Matrix, predicts that during the next five years, India's grade A warehouse stock will increase to 500 million square feet. From Rs. 20 per square foot to Rs. 28 per square foot in 2023, average rents have reached an all-time high.
India-wide, rentals have increased by 10%, with increases of 21% in Chennai and over 20% in Delhi-NCR. Retail, third-party logistics (3PL), and e-commerce are some of the leading industries with leased warehouse spaces.
Disclaimer: This information has been collected through secondary research and IBEF is not responsible for any errors in the same.
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