CARGOCONNECT-APRIL2026 - Flipbook - Page 10
THE POINT
T
he National Capital
Region (NCR) is
approaching a de昀椀ning milestone in its
logistics evolution,
with industrial and warehousing
stock projected to cross 120 million sq ft in the near term. The
expansion re昀氀ects more than just
the construction of new storage
facilities, it signals a structural
shift in how supply chains are
NCR
Warehousing
Stock Nears 120
Million Sq Ft
designed, financed, and operated in India’s most in昀氀uential
consumption market.
Record Absorption Signals
Structural Demand
The pace of growth has accelerated sharply in recent years. In
2025 alone, NCR recorded net
absorption of 9.8 million sq ft,
marking the strongest annual
performance in the region’s
industrial real estate history.
Strong occupier demand has been
matched by robust development
activity, with 9.3 million sq ft of
new supply delivered during the
year, more than half of which
comprised modern Grade A
facilities.
Demand has increasingly
concentrated in high-quality
assets. More than 70% of leasing activity in 2025 occurred in
Grade A warehouses, re昀氀ecting a
decisive shift by occupiers toward
spaces that support automation,
higher storage densities, and
operational compliance. Modern
facilities offering larger floor
plates, higher ceiling heights,
advanced 昀椀re safety systems and
energy-e昀케cient infrastructure
are becoming essential as sup10 | CARGOCONNECT APRIL 2026
ply chains evolve toward faster
and more complex distribution
models.
This demand pattern has
also tightened vacancy levels
significantly. Overall vacancy
in NCR declined by roughly 240
basis points YoY, while vacancy
in Grade A warehouses dropped
sharply to around 8.5%, indicating that demand is steadily
outpacing the delivery of highquality supply.
Infrastructure Projects
Amplify Regional
Advantage
NCR’s rise as a logistics powerhouse is closely tied to large-scale
infrastructure investments that
are improving freight connectivity across northern India.
Major national initiatives,
including the Western and Eastern Dedicated Freight Corridors,
the Delhi–Mumbai Industrial
Corridor, and the PM GatiShakti
National Master Plan are enhancing multimodal connectivity
between manufacturing hubs,
logistics clusters and consumption centres.
These infrastructure programmes are complemented by
a wider network of expressways,
industrial corridors and planned
MMLPs, all of which aim to
reduce transit times, improve
freight efficiency and create
integrated logistics ecosystems.
As connectivity improves,
NCR is increasingly positioned as
a central distribution hub linking
northern India with western and
eastern trade routes, further
strengthening its appeal to
developers and occupiers.
increase manufacturing’s contribution to GDP in the coming
decades, warehouses are increasingly being designed to support
light manufacturing, assembly and
value-added logistics functions.
These evolving requirements
are accelerating the shift toward
large-format logistics parks and
integrated industrial clusters,
replacing the fragmented network
of smaller storage facilities that
once characterised the sector.
Logistics Service Providers
Driving Demand
NCR’s Role in India’s
Expanding Warehousing
Network
The occupier mix within NCR’s
warehousing sector reflects
broader changes in India’s
consumption and supply chain
landscape. 3PL companies and
e-commerce platforms collectively
At the national level, India’s
warehousing sector has already
crossed 610 million sq ft of
total stock, with the top eight
metropolitan regions, including
The region is on the verge of crossing the
120 million sq ft threshold. This growth is a
byproduct of record-breaking performance
in 2025, where high-speed absorption and a
"昀氀ight to quality" rede昀椀ned the market.
account for more than half of total
leasing activity, driven by the
rapid expansion of omnichannel
retail and the need for distributed
ful昀椀lment networks.
Beyond logistics operators,
companies in sectors such as
fast-moving consumer goods,
electronics, retail and automotive
components are also expanding
their warehousing footprint to
support inventory diversi昀椀cation
and faster delivery cycles.
M a nu f a c t u r i ng-l i n ke d
warehousing is also gaining
momentum. As India strengthens
its industrial base and seeks to
NCR, accounting for more than
four-昀椀fths of this capacity.
These cities serve as anchor
points for large consumption
clusters and industrial ecosystems. Yet, the sector’s growth
is also spreading beyond the
metros, with several emerging
tier II cities developing logistics
infrastructure to support regional
supply chains.
Within this broader landscape, NCR continues to hold
a strategic advantage due to its
large consumer base, central
location and strong transport
connectivity.
