Manufacturing sector constitutes practically half of the transacted volumes. (Representative picture)
Mumbai was the second most prolific market, representing 16% of the entire warehousing space transacted throughout the interval
Warehouse leasing or transactions throughout major eight markets of India was recorded at ~23 mn sq ft in H1 FY 2024 (April – September 2023). 53% of those transactions occurred in Grade A areas throughout the present evaluation interval, stated a brand new report.
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Knight Frank India’s report titled ‘India Warehousing Market Report – H1 FY 2024’ added that whereas occupier sentiments proceed to be robust, traction within the warehousing market has taken a pause within the first half of FY 2024 (April to September 2023).
Transactions throughout H1 FY 2024
The 23 mn sq ft transacted in H1 FY 2024 represents a ten% drop in transacted quantity in comparison with half-yearly volumes in FY 2023 (10% lower than half the quantity transacted in FY 2023).
Transaction exercise was properly distributed throughout markets. Pune, the main market, accounted for 19% of the entire warehousing quantity, pushed primarily by the automotive business.
Mumbai was the second most prolific market, representing 16% of the entire warehousing space transacted throughout the interval, with the 3PL (third-celebration logistics) sector as a big contributor.
Warehousing Rent
Pune is the most costly warehousing rental market within the nation (amongst the reviewed eight cities) with common rents for grade A warehouses at Rs 25.9/sq ft/month. Followed by Kolkata with rental price of Rs 23.6/sq ft/month and Mumbai at Rs 23.4/sq ft/month.
While occupier traction appears to have taken a pause within the present evaluation interval, lease progress throughout markets has been comparatively wholesome in H1 FY 2024 (thirtieth September 2023) in comparison with ranges present on the finish of FY 2023 (thirty first March 2023).
Pune and Chennai at 4% and Ahmedabad with a 3% progress in six months have been markets with probably the most progress in H1 FY 2024.
Shishir Baijal, chairman & MD, Knight Frank India stated, “As the 3PL sector playing a pivotal role in the market and the manufacturing sector exhibiting substantial growth over the past two years, the overall demand from occupiers has remained remarkably resilient, even considering the e-commerce sector’s cautious approach during this period. While the global economic and geopolitical landscape is expected to exert some influence on the Indian market, it is noteworthy that the nation’s relatively robust fiscal position and resilient economy are well poised to support the stability and growth potential of the warehousing market in the remainder of fiscal year 2024.”
Industry-wise transactions:
Manufacturing Sector constitutes practically half of the transacted volumes
Continuing their robust exhibiting in FY 2023, the quantity transacted by the manufacturing sector corporations exceeded that of the 3PL sector in H1 FY 2024.
Manufacturing sector corporations corresponding to these from the automotive, vitality and chemical compounds house constituted a considerable 47% of the entire transacted quantity throughout the interval.
The report added that India has benefited from the sustained transfer in the direction of decentralisation of producing capability from China, with world manufacturing giants corresponding to Apple, Samsung, Foxconn and TSMC growing their manufacturing base within the nation.
Second to the manufacturing sector, 3PL sector corporations comprised 30% of the quantity whereas the opposite sectors had single digit shares.
E-commerce sector volumes had languished for the reason that starting of 2022 as aggressive enlargement throughout the pandemic created extra capacities which are nonetheless being utilised. With the main target more and more shifting towards profitability, e-commerce corporations have targeting curbing prices in addition to speculative enlargement.
