Over the past few years, India has seen a significant surge in the demand for warehousing rentals. This surge can be attributed to several factors, including the growth of e-commerce, especially after covid, the rise of organized retail, and the increasing importance of logistics in the country’s economy.
One of the key drivers of the surge in warehousing rentals is the growth of e-commerce in India. E-commerce companies require large warehouses to store their products and fulfill customer orders. As the number of e-commerce companies in India has grown, so has the demand for warehousing space.
In addition to e-commerce, the rise of organized retail has also contributed to the surge in demand for warehousing rentals. Organized retailers such as supermarkets and department stores require large warehouses to store their products and manage their supply chains. As these retailers have expanded their operations in India, they have driven up the demand for warehousing space. The appreciation in rental value has catapulted Indian cities including Mumbai, Bangalore, and Delhi- National Capital Region (NCR) into the tally of Asia-Pacific’s top 10 logistics market based on the performance in 2022 and a robust outlook for 2023. The standpoint for rentals is great for each of the three Indian urban communities in 2023.
Another factor contributing to the surge in warehousing rentals is the increasing importance of logistics in India’s economy. With the government’s focus on improving infrastructure and transportation networks, logistics has emerged as a key driver of economic growth. As a result, companies across industries are investing in their logistics operations, which has led to an increased demand for warehousing space.
The surge in demand for warehousing rentals has led to a significant increase in rental rates across the country. This has led to a significant increase in the overall cost of doing business for companies that rely on warehousing space.
Despite the increase in rental rates, the demand for warehousing rentals is expected to continue to grow in the coming years. Companies have understood the cycle and are investing in Grade A warehousing facilities in smaller cities. This has helped them cater to the rapidly increasing customer base in tier 2 and 3 cities as well.
Overall, the surge in demand for warehousing rentals in India is a reflection of the country’s growing economy and the increasing importance of logistics in driving that growth. While the increase in rental rates may be a challenge for some companies, the continued growth of the warehousing sector is likely to create new opportunities for businesses across industries.
