India’s industrial and warehousing sector recorded 34.8 million square feet of leasing in the first half of 2026, with manufacturing and 3PL firms driving demand, according to Savills India.
India’s industrial and warehousing sector recorded 34.8 million square feet of leasing in the first half of 2026, rising 2.4 per cent year-on-year, according to Savills India. Fresh supply increased at a faster pace, surging 27.8 per cent year-on-year to 42.7 million square feet during the same period. Manufacturing companies accounted for the largest share of leasing activity at 30 per cent, followed by third-party logistics players at 23 per cent, FMCG and FMCD companies at 18 per cent and e-commerce firms at 10 per cent. Among major markets, Delhi-NCR emerged as the largest industrial and logistics market in the first half of 2026, accounting for 6.8 million square feet or 20 per cent of total absorption, followed by Pune at 6.1 million square feet and Mumbai at 5.5 million square feet. Tier-II and Tier-III cities together contributed 7.5 million square feet, representing 22 per cent of total leasing activity.
Grade A properties accounted for 59 per cent of total leasing during the first half of 2026, up from 55 per cent a year earlier, reflecting increasing focus on ESG compliance, operational efficiency and modern infrastructure. Grade A developments accounted for 55 per cent of new supply during the period, slightly lower than 58 per cent recorded in the first half of 2025. Srinivas N, Managing Director of Industrial and Logistics at Savills India, said India’s manufacturing ecosystem was rapidly evolving into a globally integrated platform, supported by proactive trade agreements and rising investments driving strong demand for industrial and logistics real estate. Savills expects India’s industrial and logistics market to maintain stable, demand-led growth through the rest of 2026, with rental values for compliant Grade A assets likely to witness a gradual increase as land and construction costs rise, though vacancies could remain elevated in the near term due to supply outpacing demand.
Source: News 18
