Industrial and logistics space leasing hit 160 lakh sq ft in Q1 2025, boosted by strong demand in Tier-I cities.
India witnessed a notable 18.5% rise in the leasing of logistics and industrial spaces during the January–March 2025 quarter, reaching 160 lakh square feet across 24 cities, according to data released by real estate advisory firm Savills India. This is a significant increase compared to 135 lakh square feet leased during the same period last year.
Tier-I cities such as Delhi-NCR, Mumbai, Bengaluru, and Chennai dominated the market, accounting for 79% of the leasing activity. The remaining 21% came from Tier-II and Tier-III locations, including Surat, Patna, Coimbatore, and Hubli.
The manufacturing sector led absorption with 30% of the total space leased, followed closely by third-party logistics providers at 26%. Retail accounted for 12%, e-commerce 10%, while the FMCG and FMCD sectors contributed 9%.
In terms of supply, the first quarter of 2025 saw a 23% increase, reaching 159 lakh square feet compared to 129 lakh square feet during the same quarter last year. Tier-I cities contributed 12.4 million square feet, comprising 78% of the new supply, while Tier-II and III cities added 3.6 million square feet.
The surge in both demand and supply signals a robust momentum in India’s logistics and industrial real estate sector, driven by growth across manufacturing, retail, and e-commerce segments.
Source: Business Standard
