Major Transactions Shape Industrial and Warehousing Demand in India for 2024
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Synopsis
In 2024, India experienced a surge in industrial and warehousing demand, with over 28 million square feet of new supply. Large deals accounted for 40% of this demand, showcasing strong developer confidence and an optimistic market outlook, particularly in major cities like Delhi-NCR and Chennai.
Key Takeaways
- 28 million square feet of new supply in 2024.
- Large-sized deals represent 40% of industrial demand.
- Delhi-NCR leads with 26% of demand share.
- 3PL firms account for 33% of overall leasing.
- Electronics sector shows 4.5X increase in large deals.
New Delhi, Jan 21 (NationPress) The year 2024 has witnessed over 28 million square feet of new supply, marking the highest increase in recent years, which reflects enhanced developer confidence and a positive outlook for the year. Notably, large-sized transactions were responsible for 40 percent of the industrial and warehousing demand last year, as highlighted in a report released on Tuesday.
With 25.6 million square feet of gross leasing recorded in 2024, demand for industrial and warehousing spaces across the top five cities remained robust, showing a slight 2 percent year-on-year increase, according to the Colliers report.
Delhi-NCR emerged as the leader in demand, capturing a 26 percent share, with Chennai following closely at 23 percent.
On a quarterly basis, the fourth quarter of 2024 observed approximately 5.5 million square feet of demand for industrial and warehousing space across the major cities. Pune, along with Bengaluru, collectively accounted for more than half of this quarterly demand.
While third-party logistics (3PL) firms fueled the overall demand throughout the year, they made up 33 percent of the total leasing. Additionally, demand from the Engineering and Electronics sectors showed significant growth.
“At the same time, the uptake of space by occupiers from alternative demand segments continued to accelerate. The Engineering and Electronics sectors together represented nearly one-third of the annual warehousing space uptake in 2024, a substantial increase from their combined one-fourth demand share in 2023,” stated Vijay Ganesh, Managing Director of Industrial and Logistics Services at Colliers India.
Furthermore, with the surge in Q-commerce, there is a noticeable increase in demand from sectors such as FMCG and Retail, which are expected to experience long-term growth across major urban areas, Ganesh added.
Large transactions, defined as those over 200,000 square feet, accounted for approximately 40 percent of the total demand.
3PL players maintained their dominance in large-ticket transactions, holding a 35 percent share.
Interestingly, in the electronics sector, the volume of large transactions surged significantly, increasing 4.5 times in 2024 compared to 2023.
At the city level, the demand from large-sized transactions was highest in Delhi NCR during 2024, as reported.
