Leasing of industrial & warehousing space up 7% in Jan-Jun across 5 cities

Leasing of industrial and warehousing spaces across five cities rose 7 per cent to 10.8 million square feet in January-June period on better demand, according to Colliers India.

The gross leasing or absorption stood at 10.1 million square feet in the first six months last year in five major cities namely Delhi-NCR, Mumbai, Chennai, Bengaluru and Pune.

Leasing increased in Mumbai and Pune but fell in Bengaluru and Chennai. Absorption of industrial and warehousing space remained flat at 3 million square feet in Delhi-NCR.

"About 55 per cent of the gross absorption was led by third-party logistics players, followed by the engineering and automobile sectors with a share of 12 per cent each," Colliers India said in a statement.

As per the data, Bengaluru saw 29 per cent decline in leasing activities to 1.4 million square feet during January-June 2022 from 2 million square feet in the corresponding period of the previous year.

Leasing in Chennai fell 16 per cent to 1.7 million square feet from 2 million square feet.

However, Mumbai saw three-fold jump in leasing to 2.1 million square feet from 0.7 million square feet.

Absorption of spaces in Pune grew 7 per cent to 2.6 million square feet in January-June 2022 from 2.4 million square feet in the year-ago period.

Out of the total leasing in the first half of this year, Delhi-NCR accounted for maximum 28 per cent share, followed by Pune with 24 per cent share in demand.

"Third-Party Logistics players continue to dominate demand in the first half of this year and the trend is expected to continue in the next few quarters as well," said Shyam Arumugam, Managing Director, Industrial and Logistics Services, Colliers India.

He said enquiries for warehousing spaces have increased in Tier II cities as key players are strengthening their last-mile delivery supply chain to be proximate to customers.

On supply, Colliers India said that it fell 24 per cent to 11.8 million square feet in January-June 2022 from 15.6 million square feet in the year-ago period.

In Bengaluru, supply rose by 73 per cent to 1.2 million square feet from 0.7 million square feet.

Chennai saw 11 per cent rise in supply to 2.2 million square feet from 2 million square feet.

Supply in Pune went up 42 per cent to 1.5 million square feet from 1.1 million square feet. However, supply in Delhi-NCR declined 47 per cent to 5.1 million square feet from 9.5 million square feet.

Mumbai witnessed 21 per cent fall in supply to 1.8 million square feet in January-June 2022 from 2.3 million square feet in the year-ago period.