India’s 3rd-party logistics leads warehouse market with 110 mn sq. ft absorption

New Delhi, Aug 19 (IANS) India’s third‑party (3PL) logistics sector became the dominant occupier in the country’s warehousing market, recording cumulative gross absorption exceeding 110 million sq. ft between 2021 and the first half of 2026, a report said on Wednesday.

The report from JLL said the sector maintained a consistent share of gross warehousing demand, ranging between 28 per cent and 42 per cent across the period, and accounted for 11.1 million sq. ft of absorption in H1 2026 alone.

Grade A facilities have raised their share from 50 per cent in 2021 to 57 per cent in 2025, while average deal sizes expanded 25 per cent from 1 lakh sq. ft in 2021 to 1,25,000 sq. ft in 2025, the report added.

“India’s 3PL sector consistently captures the highest share of gross warehousing demand, thus establishing itself as one of the market’s most consistent growth engines,” Yogesh Shevade, Managing Director, Industrial & Logistics, India, JLL.

The 25 per cent expansion in average deal sizes is not just about scale but it signals a long‑term trajectory of growth and appetite for future‑ready infrastructure, he added.

“This is about India’s manufacturing and logistics sector becoming globally competitive through strategic infrastructure investment that supports automation, sustainability, and technology integration,” he added.

The report said that overall 3PL facility rents rose at a compound annual growth rate of 3.9 per cent from 2021 to 2025, reaching Rs 21 per sq. ft, while Grade A rents grew at 4.9 per cent CAGR to Rs 23 per sq. ft in 2025.

The report noted a pronounced shift toward institutional-grade warehousing infrastructure that reflects the systematic prioritization of operational efficiency and modern specifications supporting technology integration and automation readiness.

The rental premium for Grade A facilities accelerated notably in H1 2026, rising to Rs 23.7 per square foot marking a 7.7 per cent year-on-year increase that outpaced overall market growth. This widening differential underscores occupiers’ willingness to absorb higher costs in exchange for enhanced operational capabilities, the report noted.

—IANS

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