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Large-sized deals drove 40% of industrial & warehousing demand in 2024
Large-sized deals drove 40% of industrial & warehousing demand in 2024

January 27, 2025

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Industrial & warehousing demand healthy at about 26 million sq ft in 2024. Delhi NCR and Chennai drove 2024 demand contributing around half of the leasing activity.

With 25.6 million sq ft of gross leasing in 2024, industrial & warehousing demand across the top five cities remained healthy, witnessing a marginal 2% YoY growth. Although, there was a noticeable dip in leasing activity during the last quarter, strong space uptake in the earlier quarters ensured steady leasing levels during 2024. During the year, Delhi NCR led the demand with 26% share, closely followed by Chennai at 23% share. On a quarterly basis, Q4 2024 saw about 5.5 million sq ft of industrial & warehousing demand across the top five cities. Pune, closely followed by Bengaluru, cumulatively accounted for over half of the quarterly demand.

While Third Party Logistics (3PL) players drove overall demand during the year, and accounted for 33% share in overall leasing, demand from Engineering and Electronics segments gained traction. At a micro market level, Bhiwandi in Mumbai led the leasing activity in 2024 with about 4.5 million sq ft of demand, followed by Chakan-Talegaon in Pune and Oragadam in Chennai. Both micro markets contributed to more than 2.5 million sq ft of demand each in their respective cities. 

With 22% YoY rise, 2024 saw over 28 million sq ft of new supply, highest in the recent years, indicating improved developer confidence and an optimistic outlook for the next year. Amidst significant demand rentals in key micro markets rose by 5-10%. Overall vacancy levels at the end of 2024 remained rangebound at around 13-14%.

 

Trends in Grade A Gross absorption (mn sq ft)

 

 

3PL occupiers drove large-sized deals across cities

During the year 2024, large deals (≥ 200,000 sq ft) accounted for about 40% of the overall demand. While, with 35% share, 3PL players continued to account for majority of the large ticket transactions. Engineering segment also contributed significantly with about 20% share in large-sized deals. Interestingly, in the Electronics segment, the quantum of large deals rose significantly, ~4.5X times in 2024 as compared to 2023. At the city level, space uptake from large-sized deals was highest in Delhi NCR during 2024. 

 

Deal size trends in 2024 Grade A demand (million sq ft)

 

 

Delhi NCR & Chennai cumulatively drove around 50% of overall demand & supply in 2024 

With 22% YoY rise, 2024 saw over 28 million sq ft of new supply with close to 10 million sq ft of new industrial and warehousing developments in Delhi NCR alone. The city accounted for about 35% share in overall completions during the year. At the overall level, along with the highest annual new supply since 2020, completions were significant during Q4 2024. With 6.7 million sq ft of completions in the last quarter, the top five cities witnessed a 5% YoY rise in new supply.

Trends in Grade A Supply (million sq ft)

 


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Colliers India
Sukanya Dasgupta, Head Marketing and Communications - sukanya.dasgupta@colliers.com

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