Warehousing and Logistics Absorption Reaches 16.6 Million Sq Ft in H1 2024

The first half of 2024 marked a significant milestone for the warehousing and logistics sector, with an 8% increase in absorption, totaling 16.6 million square feet compared to the same period last year. This data, released by Vestian, a US-based workplace solutions firm, reveals a dynamic landscape in the logistics market. However, it’s important to note that this figure represents a 26% decline from the latter half of 2023, primarily driven by a staggering 74% decrease in absorption within the National Capital Region (NCR).

Leading the charge in absorption were Mumbai and Pune, which together accounted for an impressive 63% of the total absorption in the first half of 2024. Southern cities, including Bengaluru, Chennai, and Hyderabad, contributed a notable 29% to this growth. Particularly noteworthy is Mumbai’s leap in market share, which surged from 25% in H1 2023 to 41% in H1 2024. This increase is largely attributed to the heightened demand for grade-A warehouses in burgeoning industrial areas, including Bhiwandi, Panvel, Uran, Taloja, and Ambernath. In stark contrast, the NCR saw its share dwindle from 31% to a mere 6%, reflecting significant challenges faced by the region.

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Third-party logistics companies have emerged as the dominant players in the absorption market, capturing 39% of the total share in H1 2024, a substantial rise from 26% in H1 2023. This growth indicates a robust demand for logistics services as businesses increasingly rely on third-party providers to streamline their supply chains. Additionally, other sectors such as engineering, manufacturing, and automobiles also reported considerable gains. Their shares increased from 16% and 4% in H1 2023 to 22% and 9% in H1 2024, respectively, highlighting a broader resurgence in these industries.

The overall warehousing and logistics sector attracted significant investments, totaling $1.6 billion in H1 2024. This figure accounts for 42% of the total institutional investment in the real estate sector, underscoring the growing confidence among investors in the logistics market’s potential. As the sector continues to adapt to changing market dynamics, the positive absorption figures signal a promising outlook for the future of warehousing and logistics in India.

Source By:- https://www.constructionworld.in/