With 36.9 million sq ft of leasing in 2025, industrial & warehousing demand across the top eight cities remained strong, witnessing a 16% YoY growth. During the year, Delhi NCR led the demand with 24% share, closely followed by Chennai at 22% share. On a quarterly basis, after a relatively modest third quarter, Q4 2025 saw about 10.4 million sq ft of industrial & warehousing demand. Chennai, closely followed by Pune, cumulatively accounted for 56% of the quarterly demand.

While Third Party Logistics (3PL) players drove overall demand during the year, and accounted for 32% share in overall leasing, demand from Engineering and E-commerce segments too gained significant traction. At a micro market level, Bhiwandi in Mumbai led the leasing activity in 2025 with about 4.9 million sq ft of Grade A space uptake, followed by Chakan-Talegaon in Pune and Oragadam in Chennai. Both micro markets contributed to more than 2.5 million sq ft of demand each in their respective cities.

“A strong performance in the last quarter has propelled the demand for Grade A industrial & warehousing space to around 37 million sq ft in 2025, highest in recent years. Space uptake was driven by large deals, especially by 3PL firms which accounted for almost one-third of the leasing activity in the year. Moreover, developers remained upbeat about long-term prospects, and this is reflected by over 40 million sq ft of completions during 2025 - highest in recent years. With the government’s continued focus on ramping up manufacturing and logistics infrastructure, industrial & warehousing requirements are likely to scale up over the course of next few years” says Vijay Ganesh, Managing Director, Industrial & Logistics Services, Colliers India.

3PL occupiers drove large-sized deals across cities

Third-Party Logistics (3PL) players continued to dominate leasing activity during 2025 with about 12 million sq ft of Grade A space uptake, accounting for almost one-third of the annual demand. Demand from Engineering and E-commerce players also remained firm and cumulatively accounted for about 35% of the leasing activity during the year.

During the year 2025, large deals (≥ 200,000 sq ft) accounted for about 45% of the overall demand. Amongst these larger deals, 3PL companies continued to account for the bulk of share, followed by E-commerce and Engineering players.

Also Read: Apparel, F&B Account for 54% of Total Retail Leasing in H1 2025 in Top 7 Cities

Interestingly, on a quarterly basis, within the E-commerce segment, about 61% of the industrial & warehousing space uptake was through large deals, driven by large storage requirements of fulfillment centers and delivery hubs. On the contrary, more than two-thirds of deals in the FMCG and Retail segments were in the mid-sized category (100,000-200,000 sq ft), driven by the growing popularity of hyperlocal delivery firms.

“Delhi NCR and Chennai each recorded over 8 million sq ft of demand in 2025, collectively contributing over 45% of the leasing activity. Concurrently, markets like Pune and Mumbai saw space uptake of around 5 million sq ft each. The demand for Grade A warehouses across these four primary industrial hubs was predominantly driven by 3PL and engineering firms. With well-established manufacturing clusters and superior infrastructure connectivity, we expect these markets to cumulatively account for 70-80% of industrial & warehousing demand in 2026 as well.” says Vimal Nadar, National Director & Head, Research, Colliers India.