India’s industrial and warehousing real estate market delivered one of its strongest performances in recent years in 2025, driven largely by large-ticket leasing transactions and sustained demand from logistics, e-commerce, and engineering occupiers.
According to Colliers India, industrial & warehousing leasing across the top eight cities touched 36.9 million sq ft in 2025, registering a 16% year-on-year growth. Nearly 45% of this demand came from large-sized transactions of over 200,000 sq ft, underlining the increasing scale at which occupiers are expanding their logistics and manufacturing footprints.
Delhi NCR and Chennai Emerge as Demand Anchors
Two markets clearly stood out in 2025 — Delhi NCR and Chennai, which together accounted for 46% of total industrial & warehousing leasing activity during the year.
- Delhi NCR led the pack with an 8.8 million sq ft absorption and a 24% share of national demand
- Chennai followed closely with 8.1 million sq ft, contributing 22%
On a quarterly basis, after a relatively muted Q3, leasing momentum picked up sharply in Q4 2025, with 10.4 million sq ft of space transacted. Chennai and Pune together made up 56% of Q4 demand, highlighting strong year-end expansion activity by occupiers.
3PL Firms Drive One-Third of Leasing Activity
Third-Party Logistics (3PL) companies continued to dominate India’s Grade A warehousing market in 2025. Colliers data shows that 3PL players leased around 12 million sq ft, accounting for 32% of total demand.
Engineering and e-commerce occupiers also gained traction and together contributed about 35% of total leasing, reflecting the growing importance of domestic manufacturing, electronics, automobiles, and online retail supply chains.
At a micro-market level:
- Bhiwandi (Mumbai) led leasing nationally with 4.9 million sq ft
- Chakan–Talegaon (Pune) and Oragadam (Chennai) followed, each crossing 2.5 million sq ft
These locations benefited from proximity to consumption hubs, manufacturing clusters, and established logistics infrastructure.
Large Deals Dominate the Market
Large-sized transactions (≥200,000 sq ft) played a defining role in shaping leasing trends in 2025:
- 16.7 million sq ft, or 45% of total leasing, came from large deals
- Delhi NCR, Chennai, Mumbai, and Hyderabad saw 50% or more of their leasing volumes coming from such large transactions
Within the e-commerce segment, nearly 61% of quarterly leasing occurred through large-format deals, driven by the expansion of fulfillment centers and regional distribution hubs.
In contrast, FMCG and retail occupiers leaned toward mid-sized warehouses (100,000–200,000 sq ft), reflecting the rise of hyperlocal and last-mile delivery models.
Key Transactions Highlight Scale of Demand
Some of the largest deals in 2025 underline the growing scale of industrial real estate requirements:
- Scootsy Logistics (Swiggy) leased 580,700 sq ft at One K Square, Bhiwandi
- Amazon took 500,000 sq ft at Welspun Logistics Park, Luhari (Delhi NCR)
- Honda leased 500,000 sq ft at Ascendas, Hoskote (Bengaluru)
- Jabil Inc. signed 385,000 sq ft at Ecobox Industrial Park, Pune
Q4 2025 alone saw marquee transactions from DHL, D-Mart, GE Vernova, and Hyundai Mobis, highlighting strong year-end occupier confidence.
Supply Pipeline Expands Amid Developer Confidence
Developers responded to sustained demand with aggressive supply additions. New completions reached 41.7 million sq ft in 2025, marking a 15% YoY increase — the highest level in recent years.
- Delhi NCR accounted for nearly 30% of total completions
- Q4 2025 alone added ~13 million sq ft, up 40% YoY
Despite rising supply, demand in active micro-markets kept vacancy levels rangebound at around 16%. Average rentals in key logistics clusters increased 5–10%, reflecting tightening availability in high-demand locations.
Outlook: Demand to Remain Concentrated in Core Markets
Commenting on the outlook, Vijay Ganesh, Managing Director – Industrial & Logistics Services, Colliers India, said strong Q4 performance, large deal sizes, and sustained developer confidence indicate long-term growth momentum, supported by government focus on manufacturing and logistics infrastructure.
Vimal Nadar, National Director & Head – Research, Colliers India, added that Delhi NCR, Chennai, Mumbai, and Pune are expected to cumulatively account for 70–80% of industrial & warehousing demand in 2026, backed by established industrial ecosystems and superior connectivity.
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