Large-sized deals drove 40% of industrial & warehousing demand in 2024

• Industrial & warehousing demand healthy at about 26 million sq ft in 2024
• Delhi NCR and Chennai drove 2024 demand contributing around half of the leasing activity
• 3PL segment accounted for 33% of Grade A space uptake in 2024, followed by Engineering and Electronics segments
• With over 28 million sq ft, new supply rose 22% YoY during 2024, highest ever annual supply in recent years

21 January 2025: With 25.6 million sq ft of gross leasing in 2024, industrial & warehousing demand across the top five cities remained healthy, witnessing a marginal 2% YoY growth. Although, there was a noticeable dip in leasing activity during the last quarter, strong space uptake in the earlier quarters ensured steady leasing levels during 2024. During the year, Delhi NCR led the demand with 26% share, closely followed by Chennai at 23% share. On a quarterly basis, Q4 2024 saw about 5.5 million sq ft of industrial & warehousing demand across the top five cities. Pune, closely followed by Bengaluru, cumulatively accounted for over half of the quarterly demand.

While Third Party Logistics (3PL) players drove overall demand during the year, and accounted for 33% share in overall leasing, demand from Engineering and Electronics segments gained traction. At a micro market level, Bhiwandi in Mumbai led the leasing activity in 2024 with about 4.5 million sq ft of demand, followed by Chakan-Talegaon in Pune and Oragadam in Chennai. Both micro markets contributed to more than 2.5 million sq ft of demand each in their respective cities.

With 22% YoY rise, 2024 saw over 28 million sq ft of new supply, highest in the recent years, indicating improved developer confidence and an optimistic outlook for the next year. Amidst significant demand rentals in key micro markets rose by 5-10%. Overall vacancy levels at the end of 2024 remained rangebound at around 13-14%.

Trends in Grade A Gross absorption (million sq ft)

City	2023	2024	YoY change	Q4 2023	Q4 2024	YoY change
Bengaluru	3.0	3.8	27%	0.9	1.4	56%
Chennai	5.1	6.0	18%	1.6	0.7	-56%
Delhi NCR	5.1	6.6	29%	1.4	1.1	-21%
Mumbai	5.5	4.6	-16%	1.5	0.8	-47%
Pune	6.3	4.6	-27%	2.3	1.5	-35%
TOTAL	25.0	25.6	2%	7.7	5.5	-29%

Source: Colliers

Note: Data pertains to Grade A buildings. Absorption does not include lease renewals, pre-commitments and deals where only a Letter of Intent has been signed.

“While 3PL players continued to dominate demand during 2024 with 33% share in overall leasing, the share has been stabilizing over the last few quarters. Concurrently, space uptake by occupiers from other demand segments continued to pick pace. Engineering and Electronics segments cumulatively accounted for almost one-third of the annual warehousing space uptake in 2024, significantly up from their combined one-fourth demand share in 2023. Moreover, with the rise of Q-commerce, demand from segments like FMCG and Retail are seeing an uptick and are poised for long-term growth across major urban centers.” says Vijay Ganesh, Managing Director, Industrial & Logistics Services, Colliers India.

3PL occupiers drove large-sized deals across cities

During the year 2024, large deals (≥ 200,000 sq ft) accounted for about 40% of the overall demand. While, with 35% share, 3PL players continued to account for majority of the large ticket transactions. Engineering segment also contributed significantly with about 20% share in large-sized deals. Interestingly, in the Electronics segment, the quantum of large deals rose significantly, ~4.5X times in 2024 as compared to 2023. At the city level, space uptake from large-sized deals was highest in Delhi NCR during 2024.

Deal size trends in 2024 Grade A demand (million sq ft)

	Volume of large-sized deals (200,000 sq ft and more)	Share (%)	Volume of mid & small-sized deals (less than 200,000 sq ft)	Share (%)
Bengaluru	1.4	36%	2.4	64%
Chennai	2.5	41%	3.5	59%
Delhi NCR	3.3	51%	3.2	49%
Mumbai	1.6	34%	3.1	66%
Pune	1.4	31%	3.2	69%
INDIA	10.2	40%	15.4	60%

Source: Colliers

Data pertains to Grade A buildings

Note:  Share here represents share of large/mid & small-sized deals in overall leasing for their respective cities

Delhi NCR & Chennai cumulatively drove around 50% of overall demand & supply in 2024

“With 6.6 million sq ft of leasing activity, Delhi NCR regained the dominant position in terms of industrial & warehousing demand for 2024. Chennai too continued to perform well in 2024, witnessing 18% year-on-year annual demand growth and more than 5 million sq ft of new Grade A supply during 2024. Healthy market fundamentals reflect confidence of both occupiers and developers. Moreover, the Chennai industrial & warehousing market is poised to grow further over the next few years, led by its positioning as a leading industrial zone and established automobile manufacturing hub of Southern India.” says Vimal Nadar, Senior Director & Head, Research, Colliers India.

With 22% YoY rise, 2024 saw over 28 million sq ft of new supply with close to 10 million sq ft of new industrial and warehousing developments in Delhi NCR alone. The city accounted for about 35% share in overall completions during the year. At the overall level, along with the highest annual new supply since 2020, completions were significant during Q4 2024. With 6.7 million sq ft of completions in the last quarter, the top five cities witnessed a 5% YoY rise in new supply.

Trends in Grade A Supply (million sq ft)

City	2023	2024	YoY change	Q4 2023	Q4 2024	YoY change
Bengaluru	2.9	4.8	66%	1.1	1.8	64%
Chennai	4.7	5.1	9%	0.9	0.6	-33%
Delhi NCR	6.9	9.7	41%	2.0	2.1	5%
Mumbai	2.7	4.0	48%	0.2	1.1	450%
Pune	6.0	4.7	-22%	2.2	1.1	-50%
TOTAL	23.2	28.3	22%	6.4	6.7	5%

Source: Colliers

Data pertains to Grade A buildings

Deals Q4 2024

City	Quarter of Transaction	Year	Property Name	Tenant	Industry	Area (sq ft)	Cluster
Pune	Q4	2024	Global Group	Dinex	Automobile	280,000	Ranjangaon Wagholi
Mumbai	Q4	2024	Welspun Logistics Park	Comfort Grid Technologies	Engineering	256,000	Bhiwandi
Pune	Q4	2024	Vivan Group	JSW	Engineering	225,000	Chakan Talegaon
Delhi NCR	Q4	2024	Grass warehouse	Crompton	Electronics	221,000	Kulana
Pune	Q4