Industrial and Warehousing segment will bounce back faster post COVID, says experts

Industrial and warehousing segments in India are equally hit by the pandemic as any other segment. However, as per experts, the segment is likely to bounce back soon after the pandemic.

The outbreak of COVID-19 and the measures taken in order to contain the same have changed consumer consumption patterns and led to growing ecommerce demand and rapid adoption of omnichannel distribution models by companies, pushing demand for warehousing and logistics spaces across the nation.

According to a report by Savills, a property consultancy firm, the demand from e-commerce, FMCG and pharma products will help the segment in a faster recovery.

“Although both demand and supply are expected to soften in the near to medium term, a supply contraction is expected to lead to a dip in vacancies and better pricing. Selectively and sparingly, vacant retail and commercial spaces could undergo refurbishments as warehousing spaces,” said the report.

The warehousing space requirement for players, especially dealing with essential goods has witnessed a hype in recent times.

As per the report, to reduce delivery time and transportation costs so much so that over 3 million square feet of new warehousing contracts have been signed across six locations by manufacturing and e-commerce clients in the last few weeks.

Further, the report suggests, that with social distancing becoming the new normal in the post COVID world, the demand will continue amid the pandemic as retailers will be under pressure to secure warehousing location near consumer base leading to greater demand in warehousing facilities in urban areas. Warehouses are currently restricted to cities’ peripheral areas and far from the larger customer base.

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