Ware­hous­ing goes up by 85% across key In­dian mar­kets

MAN­U­FAC­TUR­ING, 3PL AND RE­TAIL sec­tors drive growth in the ware­hous­ing sec­tor that at­tracts mas­sive in­sti­tu­tional funds, states the Knight Frank Ware­hous­ing Re­port 2018 in its third edi­tion.

Cargo Talk - - Report -

CT BUREAU K night Frank In­dia launched the third edi­tion of its flag­ship In­dia Ware­hous­ing Mar­ket Re­port 2018. The re­port un­rav­els the present sce­nario of the In­dian lo­gis­tics sec­tor along with pro­vid­ing a de­fin­i­tive view on the coun­try’s top ware­hous­ing mar­kets which in­clude Mum­bai, NCR, Ben­galuru, Chen­nai, Pune, Hy­der­abad and Ahmed­abad.

Bal­birs­ingh Khalsa, Na­tional Di­rec­tor – In­dus­trial and As­set Ser­vices, Knight Frank In­dia, said, “Post GST there has been a spike in de­mand by al­most 100 per cent as com­pa­nies who were till now in a wait and watch mode have now got into ex­e­cu­tion mode.” He fur­ther adds, “For the first time we are wit­ness­ing con­sol­i­da­tion and ex­pan­sion of ware­hous­ing space. This in­crease in de­mand from sec­tors like ecom­merce, 3PLs, Con­sumer Durables, FMCG and Man­u­fac­tur­ing to name a few cou­pled with a re­quire­ment for larger sized ware­houses has opened up the field for more and more or­gan­ised play­ers which has led to a de­mand. We ex­pect the trend to con­tinue and get bet­ter in the days to come.”

Dr. Sa­man­tak Das, Chief Econ­o­mist & Na­tional Di­rec­tor- Re­search, Knight Frank In­dia, added, “Trac­tion on in­dus­trial cor­ri­dors and the in­fra­struc­ture sta­tus to the lo­gis­tics sec­tor, ware­hous­ing as a real es­tate con­stituent would be a real ben­e­fi­ciary in the times to come. Across the top eight cities in the coun­try, we have seen trans­ac­tion volumes jump by 85 per cent YoY to 25.7 mn sq ft in 2017. In­vestors had started tak­ing cog­nizance of the op­por­tu­ni­ties in this sec­tor much be­fore the gov­ern­ment could im­ple­ment the re­forms. The past few years have wit­nessed mas­sive par­tic­i­pa­tion from in­sti­tu­tional in­vestors. Some of them have pur­chased ready as­sets, whereas others in a mix of ready and Green­field as­sets.”

Key Take­aways:

Leas­ing trans­ac­tions in the ware­hous­ing sec­tor across key In­dian mar­kets bur­geoned to 25.7 mn sq. ft in 2017, record­ing 85 per cent spike YoY The Na­tional Cap­i­tal Re­gion (NCR) at­tracted the high­est foot­print in terms of trans­ac­tions in the ware­hous­ing space with leas­ing of 6.5mn sq.ft in 2017, fol­lowed by Mum­bai at 5.2 mn sq. ft. Mum­bai recorded the largest YoY growth with a staggering 231per cent jump in ware­hous­ing space leas­ing in 2017. NCR fol­lowed closely with 129per cent YoY in­crease From a sec­to­rial per­spec­tive man­u­fac­tur­ing, 3PL (3rd Party Lo­gis­tics), and re­tail ac­counted for two-third of the share in terms of leas­ing volumes in the ware­hous­ing space in 2017. When as­sessed separately the share of the man­u­fac­tur­ing sec­tor ta­pered from 30per cent to 21per cent while that of 3PL nearly dou­bled from 16per cent to 29per cent. Re­tail more than dou­bled its share from 9per cent to 16per cent, al­beit on a smaller base. Around US $3.4 bil­lion (`22,100 crore) of in­sti­tu­tional cap­i­tal poured in the ware­hous­ing sec­tor be­tween 2014-2018.

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