The warehousing stock of India is expected to cross 375 mn sq ft by 2023 with an increased share of Grade A stocks. Strong demand is expected to drive the market absorption and keep the vacancy below 10%, said JLL in its latest report.
JLL India Industrial Services report says that 2019 witnessed a 15% y-o-y growth in total net absorption in Grade A & B warehousing space in top eight cities. The Delhi NCR region followed by Mumbai and Bengaluru remained the top three cities in terms of warehouse space absorption in 2019. “These three cities together account for more than 20 mn sq. ft of absorption. Interestingly, other cities such as Kolkata, Chennai and Pune continued their strong show,” it mentioned.
“Sectors such as 3PL and ecommerce are prompting the market to develop more Grade A warehousing space as occupiers make the transition to spaces with global level specifications. This is further being enabled by liquidity infusion by global investors as in the longer run, increased capital will ensure that more quality space is being built to fulfil the demand for warehouses not only in tier I but going forward in tier II cities”, said Yogesh Shevade, Head – Industrial Services, JLL India.
The year 2019 also saw larger funds and developers evaluating regional developments having strong tenant profile with a combination of land and stabilised assets. Global funds like Blackstone, ESR and Morgan Stanley are some of the firms that invested in a combination of platform or project level deal.
India’s logistics and warehousing sector is expected to see significant growth with foreign capital remaining an integral part of the development.
