Most clusters aligned with industrial freight corridors
Investors are upbeat on India’s warehousing sector and are working closely with developers to identify warehousing investment opportunities, said a report released on 7 Oct 2020 by an India-US venture of property consultants.
High-intensity focus on making India a global manufacturing hub has caused warehousing clusters to expand rapidly beyond the top cities and into tier 2 and 3 cities.
Demand for small and multi-location warehouses is expected to rise significantly, reveals ‘Indian Industrial & Logistics – Gearing Up a Global Manufacturing Hub’, a joint report by US-based Binswanger Commercial Real Estate Services and ANAROCK Group.
The report highlights that nearly US$7 billion worth of platforms has been created for the warehousing sector since 2015. Over US$2 billion in PE investments have been infused in the Industrial and Logistics sector between 2017 and Q1 2020.
Most of these emerging clusters are aligned with the industrial and freight corridors being developed in the country.
The emerging tier 2 and 3 warehousing clusters include Ludhiana, Ambala, Lucknow, Siliguri, Guwahati, Bhubaneshwar, Vishakhapatnam, Vijaywada, Coimbatore, Kochi, Nagpur, Indore, Jaipur and Dholera.
The two firms recently joined hands to offer boutique advisory, brokerage and transaction services on industrial real estate opportunities between India, USA and other global markets.
“The market is expected to de-centralize to mitigate future disruption, ensure business continuity and ease operations,” Jeff Binswanger, Managing Partner, Binswanger International said in comments on the trends emerging following the post-COVID-19 that has exposed the challenges of consolidation within the warehousing sector.
“To contain costs and maintain social distancing norms, automation will become a major focus area. Also, e-commerce will flourish in the post-COVID-19 era, giving an edge to online businesses which will eventually boost new warehousing demand – particularly multi-level warehouses within city limits,” said Binswanger on the report released on 7 Oct 2020.
“The rising demand for Grade A warehousing properties across the country is a key trend. Our data indicate that there are more than 110 mn sq. ft. of Grade A warehousing stock available across the country – most of it in the top 8 cities,” said Shobhit Agarwal, MD & CEO – ANAROCK Capital.
Third-party logistics and e-commerce are the largest occupiers of warehousing space. There is a massive opportunity for Grade A warehousing development in the smaller cities amidst rising demand, according to Agarwal. #investment #banking #warehousing #logistics #industrial /fiinews.com
