Cushman & Wakefield’s annual Logistics and Industrial Report reveals India’s logistics market surpassing 50 MSF in leasing for two consecutive years, showcasing remarkable resilience and sustained growth.
India’s logistics sector has demonstrated impressive resilience, achieving over 50 MSF in leasing for two consecutive years, as highlighted in Cushman & Wakefield’s annual Logistics and Industrial Report (L&I). Despite challenges, the sector maintained momentum and growth throughout 2022 and 2023.
In 2023, warehouse leasing experienced a modest 7 percent decline, reaching 37.7 MSF compared to the previous year’s 40.4 MSF. Conversely, industrial leasing recorded a substantial 23 percent year-on-year growth, reaching nearly 16 MSF. This growth in industrial leasing reflects the increasing trend of manufacturing activities, fueled by healthy capacity utilisation and government initiatives like the multi-sector PLI scheme.
Mumbai retained its status as the leading warehousing hub, securing a 27 percent market share in 2023, closely followed by Chennai at 19 percent. Despite a dip in activity in Delhi-NCR, the expansions in Chennai and Pune ensured consistent performance across India.
Chennai emerged as a standout performer in 2023, witnessing exceptional growth in both logistics and industrial sectors. The city experienced a notable 2.1x increase in overall leasing activity, reaching 10.78 MSF compared to 5.16 MSF in 2022. Warehouse leasing nearly doubled to 6.97 MSF, with the Oragadam submarket witnessing a significant 5x growth.
Chennai’s demand was predominantly driven by the 3PL per logistics sector, contributing 64 percent to the yearly gross leasing activity, followed by the Engineering & Manufacturing sector with a 31 percent share. Manufacturing tenants leased 3.8 million sq ft, with electronics and automobile sectors leading in Oragadam and Sriperumbudur.
Abhishek Bhutani, Managing Director, Logistics & Industrials, Cushman & Wakefield, expressed optimism about the sector’s growth trajectory, citing strong economic fundamentals and supportive government policies as key drivers. He anticipates continued momentum in 2024, solidifying the Logistics & Industrial segment as a significant contributor to India’s real estate growth.
