Industrial & Warehousing demand in India stable in H1 2023: Colliers

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New Delhi: Industrial and warehousing demand across the top five cities was stable during H1 2023 with 11 mn sq ft of leasing, compared to the same period last year, professional services and investment management company Colliers said in a report. According to it, Delhi-NCR continued to lead demand with 25.0% share, closely followed by Mumbai at 24.6%.

While most of the cities saw a single digit change in demand, Mumbai witnessed a notable 28% YoY increase in leasing during the first half, largely driven by expansion from players in 3PL sector, the report said. Despite the global economic headwinds, the industrial and warehousing sector is seeing steady growth backed by rising capital investments, manufacturing output and government policy enablers.

The consistent trend in leasing was primarily driven by 3PL (third-party logistics) operators, accounting for 37% of total leasing during the first half of 2023 followed by FMCG and Engineering firms with a share of 12% and 11% respectively. “While 3PL continues to lead demand, leasing by FMCG and engineering firms across the major markets in India witnessed a significant rise during the first half of 2023.

Notably, demand from E-commerce rose 68% YoY, after a lull in the last few quarters. The overall demand for the industrial and warehousing market has been bolstered by various factors, including increased production capacity, strong government policy support and inclusion of more automated and process driven manufacturing," Vijay Ganesh, Managing Director, Industrial & Logistics Services, Colliers India said.

“While 3PL players are likely to dominate demand, we expect strong & steady momentum in leasing from other segments as well," he added. Amidst steady demand for