The increased logistics and storage requirements in urban settings is expected to take the warehousing stock in India to 380 million sq ft by 2024, according to property advisory JLL.
The covid-19 pandemic has brought a paradigm shift in consumer behavior from offline to online shopping and lead to increased activity in sectors like e-commerce and third-party logistics.
About 27 million sq ft of warehousing stock was added during the January-September period, bringing the total stock to 265 million sq ft this year.
The total stock of Grade A and B warehousing space in the top 8 cities increased at a CAGR of 16% from 2018 to September 2021.
“Growth in the supply of Grade A spaces over the years is due to high demand for spaces with high specifications, citing increased inclination for high-grade structures and introduction of new players in the market. The Indian market has now firmly established itself for a more predominant position in Grade A space as opposed to Grade B spaces,”Yogesh Shevade, head – logistics and industrial, India, JLL
In 2020, the net absorption was hit due to the pandemic but started recovering in 2021 especially for Grade A spaces – from 56% last year to 73% this year.
JLL held the high demand for quality spaces complying with covid-19 norms as the reason behind this shift.
Of the total absorption till the September quarter, more than half the share is taken up by third-party logistics and e-commerce (55%).