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Logistics Leasing Records 31% Growth In One Year: CBRE

Mumbai, Chennai, and Bangalore accounted for close to 60% of leasing. 3PL sector contributed close to 56% of total absorption during H1 2019 compared to 31% in H22018. About 11 million sq. ft. supply added in H1 2019; led by Mumbai, Chennai, and Ahmedabad. Investment of more than USD 200 million recorded in the industrial and logistics sector


India’s logistics leasing recorded a growth of 31% on a yearly basis, crossing 13 million sq. ft, reveals CBRE, India’s leading real estate consulting firm, in its report ‘India Industrial and Logistics Market View, H1 2019’. As per the report, Mumbai, Chennai, and Bangalore accounted for more than 60% of leasing activity.

CBRE Logistics Data RealtyMythsDescribing this momentum, Anshuman Magazine, Chairman & CEO – India, South East Asia, Middle East & Africa said, “While the overall pipeline for the sector is expected to be around 60 million sq. ft. till 2020, at least 22 million sq. ft. of this supply is anticipated to be released by leading players. We also expect logistics leasing activity to strengthen owing to consolidation/ expansion by occupiers. In addition, as per our APAC Investor Intention Survey, 2019, India was among the top five investment destinations in APAC. Industrial & logistics was also one of the top segments expected to be targeted by investors in 2019.”

CBRE Logistics RealtyMythsSimilar toH2 2018, logistics space take-up was dominated by small-sized transactions (less than 50,000 sq. ft.), accounting for about 38% of the leasing activity in H1 2019. The share of medium-sized transactions (ranging between 50,000 sq. ft. and 100,000 sq. ft.) rose from 26% in H2 2018 to 32% in H1 2019. Large-sized deals (greater than 100,000 sq. ft.) accounted for 30% of the leasing activity during H1 2019.

For H2 2019, CBREexpects supply-constrained locations to continue to deliver rental growth, with new logistics hubs also emerging across cities in response to labor availability and land shortage. Prime locations likely to witness rental growth in coming months include NH-8 in NCR; Bhiwandi in Mumbai; Western and Northern Corridors in Chennai; Northern Corridor in Hyderabad; and NH-2 and NH-6 in Kolkata.

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