Delhi NCR, Chennai, and Mumbai lead leasing and supply; 3PL and e-commerce drive large transactions.
India’s industrial and warehousing sector posted a record 26.5 million sq ft of Grade A space absorption across the top eight cities during the first nine months of 2025, marking an 11 per cent year-on-year growth, according to the real estate consultancy Colliers India. Despite global trade uncertainties, the sector continues to demonstrate resilience, with sustained occupier interest and strong fundamentals driving momentum.
While Q2 2025 was among the best-performing quarters on record, demand moderated in Q3 to 7.0 million sq ft—a 23 per cent decline year-on-year. However, festive season logistics and rising electronics sales are expected to lift Q4 volumes.
Delhi NCR, Chennai, and Mumbai collectively accounted for over 60 per cent of leasing activity between January and September. Delhi NCR led with 7.4 million sq ft, followed by Chennai at 5.1 million sq ft and Mumbai at 4.2 million sq ft. Micro-markets such as Luhari and Farukh Nagar (Delhi NCR), Oragadam (Chennai), and Bhiwandi (Mumbai) remained highly active.
“The average quarterly leasing of Grade A facilities has remained strong at around 9 million sq ft. Large deals continue to anchor demand, particularly in 3PL and e-commerce, supported by sustained consumption and easing supply-side constraints,” said Vijay Ganesh, Managing Director, Industrial & Logistics Services, Colliers India.
Third-Party Logistics (3PL) firms dominated leasing, contributing nearly one-third of total demand. Engineering and e-commerce segments followed at 20 per cent and 15 per cent, respectively. Notably, e-commerce saw a 2.5x surge in space take-up compared to the same period last year, driven by large transactions in key clusters.
Delhi, Mumbai, Chennai Lead Uptake
New supply outpaced demand, reaching 28.8 million sq ft in the first nine months, a 6 per cent increase year-on-year. Delhi NCR, Chennai, and Mumbai accounted for nearly two-thirds of completions, with NH 16 (Chennai), Bhiwandi (Mumbai), and Luhari & Farukh Nagar (Delhi NCR) emerging as preferred corridors.
“Delhi NCR continues to lead both demand and supply, followed by Chennai and Mumbai. Occupier interest remains strong in well-connected micro-markets with robust infrastructure. Despite global headwinds, we expect demand to remain firm, backed by domestic consumption and a healthy pipeline of quality assets,” said Vimal Nadar, National Director & Head of Research, Colliers India.
Vacancy levels rose by 160 basis points quarter-on-quarter due to supply outpacing demand. However, rentals in prime micro-markets continue to firm up, reflecting occupiers’ flight to quality and preference for sustainable, best-in-class warehousing facilities.
Major deals in Q3 included DB Schenker leasing 384,809 sq ft in Bhiwandi, Zomato’s 280,000 sq ft lease in Dankuni, and Avenue Supermarts’ 251,677 sq ft transaction in Chennai’s NH 48 corridor. Earlier in the year, Amazon leased 500,000 sq ft in Luhari, while Swiggy’s Scootsy Logistics took up 580,753 sq ft in Bhiwandi.