Logistics and industrial sector sees strong growth in the first half of 2024: JLL

India's logistics and industrial sector demonstrated significant growth in the first half of 2024, highlighting its resilience and market relevance, according to a report by JLL. Major cities, including Mumbai, Delhi NCR, Bengaluru, Kolkata, Chennai, Hyderabad, Ahmedabad, and Pune, saw substantial YoY rent increases of 4.8% for Grade A and 6.4% for Grade B properties, reflecting strong demand for warehousing and light manufacturing leases.

The report noted that Grade A properties had a vacancy rate of 6.6% in the first half of 2024, while Grade B properties faced a 15.4% vacancy rate. Gross absorption in the top 8 cities totalled approximately 24.2 million sq. ft., with Grade A properties accounting for 70% and Grade B properties 30%. The total industrial property supply currently stands at 393 million sq. ft. It is expected to reach around 595 million sq. ft. by 2027. Organized Grade A warehousing supply is at 204 million sq. ft., surpassing the 189 million sq. ft. of Grade B supply, indicating a strong tenant preference for future-ready spaces. The third-party logistics (3PL) sector remains the largest demand driver, holding a 38% share of gross absorption, followed by the auto and engineering sector at 23%, and FMCG, FMCD, and retail sectors contributing 20%. Growth drivers include quick commerce, the National Logistics Policy, increased e-commerce penetration, and outsourcing to 3PL providers. The emphasis on ESG considerations is also rising, with sustainability practices becoming integral to construction and operations.

Disclaimer: This information has been collected through secondary research and IBEF is not responsible for any errors in the same.