Indian logistics rents outpace APAC growth as warehouse demand tightens
Mumbai, Delhi-NCR and Bengaluru prime logistics rents rose 4.4%–5.3% year-on-year, supported by e-commerce, retail, manufacturing and 3PL demand. Knight Frank India expects further growth as occupiers seek modern, automated warehouse space.
What happened
Knight Frank India · India’s Mumbai, Delhi-NCR and Bengaluru logistics hubs outpaced APAC rental growth, driven by manufacturing, consumption, e-commerce,
Key facts
- Mumbai prime logistics rents: Rs 26 per sq ft per month, up 5.3% year-on-year and 4.4% over six months; vacancy 13.5%
- Delhi-NCR prime logistics rents: Rs 22.30 per sq ft per month, up 5.2% year-on-year and 2.8% over six months; vacancy 14.7%
- Bengaluru prime logistics rents: Rs 23.50 per sq ft per month, up 4.4% year-on-year and 2.2% over six months; vacancy 17.6%
- Asia-Pacific logistics rental growth: 1.2% half-year-on-half-year
- 15 of 18 APAC cities recorded stable or increasing rents
Why this matters
Retail and logistics buyers should prioritize automated, strategically located warehouse assets or partnerships before further rent growth raises the cost of securing scalable fulfillment capacity.
What to watch
- Quarterly Grade A logistics vacancy rates and new supply completions in Mumbai, Delhi-NCR and Bengaluru.
- Further prime-rent acceleration above roughly 6% year-on-year, particularly at port, airport and consumption-cluster locations.
- E-commerce order growth, quick-commerce dark-store expansion and festive-season 3PL capacity utilisation.
- Large retailer or 3PL announcements of long-term warehouse pre-leases, build-to-suit projects or automation deployments.
- Changes in land prices, financing costs, industrial-zoning approvals and transport infrastructure that alter warehouse development economics.
- Secure longer-duration leases or pre-commitments for automated, Grade A warehouse capacity in high-demand corridors.
- Rebalance inventory toward regional fulfilment centres and lower-rent secondary markets where service-level economics remain viable.
- Audit 3PL contracts for rent-escalation clauses, fuel surcharges and capacity guarantees before peak-demand periods.
- Prioritise automation investments that raise throughput per square foot and reduce reliance on additional leased space.
- Use stores as click-and-collect, ship-from-store or returns nodes where warehouse rent inflation exceeds incremental store-fulfilment costs.