170% rise in five years led by demand from
manufacturing & e-commerce sectors
The manufacturing sector has seen significant leasing activity, with approximately 40-45 million sq ft leased in the top eight cities over the past three years (2022-2024). This trend, along with the Government push through initiatives such as Make in India 2.0 and the Production-linked Incentive (PLI) scheme, are providing an easy entry route for manufacturing operations.
Grade A warehousing stock in India surged 170 per cent in the past five years, reaching an all-time high of 238 million square feet last year, according to a report by JLL.
The total logistics and industrial real estate sector stock across the top eight cities reached 438 million square feet, with projections suggesting it could hit approximately 700 million sq ft by 2028, according to the report.
This growth is driven by the occupiers increasingly looking for good quality and compliant spaces as well as rising traction from institutional investors in the sector. Demand remained strong, with net absorption for 2024 reaching an all-time high of 50.4 million sq ft, up from 40.6 million sq ft in 2023.
The 3PL / logistics and manufacturing sectors led the absorption in the market accounting for more than 65 per cent. The year 2024 also witnessed revival of demand from the e-commerce sector, especially from quick commerce companies, said the report.
“Manufacturing leased factories demand scaled a new peak in 2024 accounting for more than 30 per cent of the demand providing manufacturers faster and efficient entry / expansion options,” said Yogesh Shevade, Head–Logistics and Industrial, India, JLL.
The manufacturing sector has seen significant leasing activity, with approximately 40-45 million sq ft leased in the top eight cities over the past three years (2022-2024). This trend, along with the Government push through initiatives such as Make in India 2.0 and the Production-linked Incentive (PLI) scheme, are providing an easy entry route for manufacturing operations.
Grade A warehousing is taking centre stage with close to 80 per cent of net absorption under this category, driven by availability and superior infrastructure.
Looking ahead, the demand for Grade A warehousing spaces, distinguished for their superior infrastructure, is expected to remain buoyant. Institutional developers and investors are actively prioritising resources for the development of high-quality Grade A warehousing spaces. “The growing preference among occupiers and investors for technology adoption and sustainable logistics facility for optimising long term operational cost efficiency and achieving net-zero ambitions,” said the report.