In the third quarter (July-September) of the calendar year, Chennai led in demand for the leasing in industrial and warehousing sectors, per a report by Colliers. The city’s economic activity has always been driven by a diverse range of sectors, starting from automobile and electronics, hardware to textiles, media industry and software services. Few of these sectors played a critical role in the strong warehousing demand in Q3 2023.

Interestingly, for the first time in the last few quarters, Chennai led leasing activity with about 30 per cent share amongst the top five cities. Within Chennai, NH-16 and NH-48 micro-markets saw demand driven largely by occupiers from 3PL and engineering sectors and electronics sector to a certain extent.

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With 17 million square feet of gross leasing in the first three quarters of 2023, industrial and warehousing demand across the top five cities is almost comparable to the corresponding period of 2022. Despite a relatively slower growth during H1 2023, leasing activity picked up in Q3 2023, registering a 55 per cent QoQ growth.

Pune led the demand during the nine-month period with 24 per cent share, closely followed by Mumbai at 23 per cent, both edging ahead of the usual front runner, Delhi-NCR. Overall, Bhiwandi remained the most active micro-markets in Mumbai, while Chakan-Talegaon continued to be the preferred market for industrial occupiers in Pune.

Third-party logistics players (3PLs) continued to be the top occupiers of warehousing space, contributing to about 40 per cent share in total warehousing demand till date. 3PL space uptake was driven by healthy activity in Mumbai and Chennai particularly, the release said.

Trends in Grade A Gross absorption (mn sq ft)

CityQ3 2023Q3 2022YoY change (%)
Delhi NCR0.93.8-76

(Source: Colliers)