Massive demand for Grade A warehousing in Tier 2 & 3 cities
A joint report by US-based Binswanger Commercial Real Estate Services and the ANAROCK group has emphasized the high-intensity focus on making India a global manufacturing hub, which has led to the rapid expansion of warehousing clusters beyond the top cities into Tier 2 and 3 cities. The report further elaborates that there is a significant increase in demand for small and multi-location warehouses. Most of these emerging clusters are strategically aligned with the upcoming industrial and freight corridors across the country.
The fast-emerging Tier 2 and 3 warehousing clusters include Ludhiana, Ambala, Lucknow, Siliguri, Guwahati, Bhubaneshwar, Visakhapatnam, Vijayawada, Coimbatore, Kochi, Nagpur, Indore, Jaipur, and Dholera.
One key trend highlighted in the report is the rising demand for Grade A warehousing properties across the country. The statistics indicate that there is more than 110 million sq. ft. of Grade A warehousing stock available across the country, with the majority of it located in the top 8 cities. The largest occupiers of warehousing space are 3PL (third-party logistics) and e-commerce companies. According to Shobhit Agarwal, MD & CEO of ANAROCK Capital, there is a massive opportunity for Grade A warehousing development in smaller cities due to the increasing demand.
The study also points out that nearly $7 billion worth of platforms have been created for the warehousing sector since 2015, with over $2 billion in PE investments infused into the industrial and logistics sector between 2017 and Q1 2020. Investors are optimistic about this sector and are closely collaborating with developers to identify warehousing investment opportunities.
The fast-emerging Tier 2 and 3 warehousing clusters include Ludhiana, Ambala, Lucknow, Siliguri, Guwahati, Bhubaneshwar, Visakhapatnam, Vijayawada, Coimbatore, Kochi, Nagpur, Indore, Jaipur, and Dholera.
One key trend highlighted in the report is the rising demand for Grade A warehousing properties across the country. The statistics indicate that there is more than 110 million sq. ft. of Grade A warehousing stock available across the country, with the majority of it located in the top 8 cities. The largest occupiers of warehousing space are 3PL (third-party logistics) and e-commerce companies. According to Shobhit Agarwal, MD & CEO of ANAROCK Capital, there is a massive opportunity for Grade A warehousing development in smaller cities due to the increasing demand.
The study also points out that nearly $7 billion worth of platforms have been created for the warehousing sector since 2015, with over $2 billion in PE investments infused into the industrial and logistics sector between 2017 and Q1 2020. Investors are optimistic about this sector and are closely collaborating with developers to identify warehousing investment opportunities.
LIFTING & SPECIALIZED TRANSPORT, SEPTEMBER u2013 OCTOBER 2023