India’s warehousing sector is witnessing a demand-side recovery in the first quarter of 2026, with pan-India leasing activity crossing 11 million sq ft. However, growth remains heavily concentrated in western markets, particularly Mumbai and Pune.
Mumbai has emerged as the country’s single largest warehousing market, accounting for roughly 39 to 42 per cent of quarterly absorption, driven by strong activity in Bhiwandi and rising demand from third-party logistics, engineering, manufacturing and consumer-facing sectors. Pune has also recorded a sharp uptick, contributing close to 39 per cent of national absorption in Q1 2026 following several large transactions, taking the combined Mumbai-Pune share to over 80 per cent of total demand in recent quarters.
Despite robust occupier activity, investment flows into new warehousing projects have slowed considerably. Developers are contending with higher financing costs, expensive land in key micro-markets and uncertainty stemming from global geopolitical tensions affecting trade and supply chains.
Sector analysts note that policy support through the National Logistics Policy and continued infrastructure development are keeping occupier sentiment positive. However, they caution that without a meaningful pick-up in fresh capital deployment, the recovery will remain uneven and concentrated in established western corridors, rather than extending to emerging logistics hubs across the country.
Source: Economic Times
