Warehousing absorption to be highest ever

It is anticipated that the warehousing sector to witness the best ever absorption in 2022. This is attributed to the increasing growth in the e-commerce sector and the expansion of third-party logistics (3PL) companies, according to transaction advisors and industry experts.

In 2021, the online absorption of warehousing stood at 39.2 million sq ft, surpassing the absorption level of 2020, and 2019 which was 22.1 million sq, and 36.3 million sq ft, respectively. According to data from JLL India, the figures for 2022 are estimated at 42.5 million sq ft driven by the present pipeline of impending transactions.

“The demand for warehousing is rising and enquiry levels are seeing robust growth. This demand dynamic will only strengthen further, catalysed by the Production Linked Incentive scheme (PLI) stimulus and the $1.4 trillion Gati NSE -0.78 % Shakti investment supporting India’s logistics infrastructure,” stated Rahul Pandit, CEO, Horizon Industrial Parks. He further added that the average size of grade a warehouses has doubled from 80,000 sq ft in 2016 to 160,000 sq ft in the first half of 2022. E-commerce companies like Flipkart and Amazon have leased over a quarter of India’s total warehouse capacity in the last two years.