India’s Logistics and Industrial Real Estate Sector Sees Robust Growth in H1 2025

India’s Logistics and Industrial Real Estate Sector Sees Robust Growth in H1 2025

New Delhi, September 14 (ANI) – India’s logistics and industrial real estate sector has experienced a remarkable resurgence, recording a staggering 21.6% year-on-year growth in leasing activity during the first half of 2025. According to the latest H1 2025 Logistics & Industrials Marketbeat Report by Cushman & Wakefield, total leasing reached 30.7 million square feet (MSF), marking a 12.1% increase compared to the second half of 2024.

This impressive growth is primarily driven by heightened demand in both the warehousing and manufacturing segments. The report highlights that the sector has demonstrated strong fundamentals, with annual leasing surpassing 50 MSF for three consecutive years. With the current momentum, experts predict that gross leasing could exceed 60 MSF by the end of the year, setting a new benchmark for the industry.

Warehousing emerged as the dominant force, accounting for 21.9 MSF of total leasing—71.3% of the overall activity—while industrial space contributed 8.8 MSF, representing 28.7%. Notably, the Engineering & Manufacturing (E&M) sector led the charge with 9.7 MSF leased, capturing 32% of total absorption and achieving a remarkable 37% year-on-year growth.

Third-party logistics (3PL) operators also showcased stable growth, leasing 7.4 MSF, which constitutes a 24% share of the market. The e-commerce sector recorded the most significant annual surge, with a staggering 158% growth to reach 4.6 MSF, driven by festive season stocking and the expansion of last-mile delivery networks.

Abhishek Bhutani, Managing Director of Logistics & Industrial Services India at Cushman & Wakefield, commented, “The H1 performance reinforces how India’s logistics and industrial sector has moved beyond cyclical swings to demonstrate structural strength. The consistency of demand across segments highlights that occupiers are no longer only chasing capacity but also efficiency, location, and long-term value.”

City Highlights

In terms of geographical performance, Mumbai led the leasing activity with 7.0 MSF, capturing 23% of the market and achieving an impressive 131.3% year-on-year growth. Ahmedabad, while smaller in absolute volume at 1.7 MSF, recorded the highest growth rate at 192.2%, underscoring its rising significance in the logistics landscape.

Delhi NCR followed with 5.1 MSF (17% share), while Pune reported 4.5 MSF (15% share). Other cities like Chennai, Bengaluru, Hyderabad, and Kolkata also demonstrated steady leasing activity, contributing to the overall growth of the sector.

Future Outlook

Looking ahead, the report indicates a healthy supply pipeline of 25 MSF of Grade-A warehousing expected over the next 2-3 years. Supportive policy measures and sustained demand are anticipated to maintain the upward trajectory of India’s logistics and industrial real estate sector through 2025. Growth will be further propelled by ongoing manufacturing expansion, increased e-commerce penetration into Tier-II and Tier-III cities, and the continued adoption of technology in supply chain management.

As the sector continues to evolve, it is clear that India’s logistics and industrial real estate market is poised for a bright future, driven by innovation and strategic growth.