Industrial & Warehousing Space Leasing To Grow By 83% In 2021
<span style="font-weight: 400;">Industrial and warehousing space absorption is expected to grow by 83% to 47.7 million sq ft in 2021, driven by a robust growth in e-commerce and manufacturing sectors as well as rising demand in emerging tier I and tier II cities, according to Savills India, a global
Published -
Jan 12, 2021 4:58 AM
Industrial and warehousing space absorption is expected to grow by 83% to 47.7 million sq ft in 2021, driven by a robust growth in e-commerce and manufacturing sectors as well as rising demand in emerging tier I and tier II cities, according to Savills India, a global property consultancy firm. The 3PL and e-commerce sectors continued to drive warehousing demand accounting for 60% of the total absorption in 2020, followed by manufacturing sector at 24%. NCR led with the highest absorption in 2020 at 25% followed by Pune at 15%. Mumbai and Chennai saw absorption at 13% each while Kolkata stood at 12.0%. The Tier II cities such as Ludhiana, Lucknow, Coimbatore, Jaipur, Guwahati, Bhubaneswar, Nagpur and Patna witnessed around 3 million sq. ft. in 2020. On the supply side, Savills India expects a 113% increase in supply to 47.9 million sq ft in 2021. Despite construction activities getting affected due to the lockdown, the top-8 cities of India witnessed a fresh supply of 22.4 million sq ft last year. NCR accounted for 22% of the total supply witnessed in 2020 followed by Chennai (20%), and Bangalore (12%). The overall industrial and warehousing space stock is expected to increase by 21% at 278 million sq ft in 2021 as compared to 230 million sq ft last year. Warehousing vacancies have also decreased by 170 basis points from 10.2% in 2019 to 8.5% in 2020 and rental values remained stable in 2020 across the major cities. In 2020, the industrial and warehousing market witnessed investments in excess of 1 billion USD, the company said.
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