Delhi NCR, Chennai Lead India’s Industrial Leasing Boom in 2025

India’s industrial and warehousing sector clocked a record 36.9 million sq ft of leasing in 2025, registering a 16% year-on-year growth, according to a report by Colliers India. The standout driver was the rise of large-ticket transactions, which accounted for 45% of total leasing demand, underlining growing scale and consolidation across occupiers.

Third-Party Logistics (3PL) players continued to dominate, accounting for 32% of Grade A space uptake, reflecting the sustained expansion of organised logistics networks. At the same time, engineering and e-commerce firms stepped up activity, together contributing 35% of the annual demand, signalling a broad-based recovery beyond pure logistics.

Geographically, Delhi NCR and Chennai emerged as the growth engines, together accounting for 46% of total leasing activity in 2025. At a micro-market level, Bhiwandi (Mumbai) led with 4.9 million sq ft of Grade A leasing, followed by Chakan–Talegaon (Pune) and Oragadam (Chennai)—all hubs closely tied to manufacturing and logistics corridors.

Quarterly trends reflected a strong finish to the year. After a softer third quarter, Q4 2025 recorded 10.4 million sq ft of leasing, with Chennai and Pune together contributing 56% of the quarter’s demand. High-profile transactions underscored this momentum, including Jabil Inc.’s 385,000 sq ft lease in Pune and DHL’s 380,400 sq ft uptake in Chennai.

Sectoral behaviour also revealed clear patterns. E-commerce players favoured scale, with 61% of their quarterly leasing coming from large fulfilment centres, while FMCG and retail firms prioritised agility. Over two-thirds of their deals were mid-sized, aimed at supporting faster, hyperlocal delivery models.

On the supply side, developers responded aggressively. New completions touched 41.7 million sq ft in 2025, a 15% annual increase, led by Delhi NCR, which alone contributed 30% of fresh supply. Construction peaked in Q4 2025, with 13 million sq ft added, marking a sharp 40% jump year-on-year for the quarter.

Despite the surge in supply, vacancy levels remained stable at around 16%, as strong demand absorbed new stock in high-activity micro-markets. This tight balance pushed average rentals up by 5–10% across leading logistics clusters.

Looking ahead, Colliers expects Delhi NCR, Chennai, Mumbai and Pune—currently dominated by 3PL and engineering occupiers—to continue driving the market, collectively accounting for 70–80% of total industrial and warehousing demand in 2026. With developers optimistic and large-scale transactions becoming more common, India’s industrial real estate story appears firmly on an expansion path.

(ANI and yMedia are content partners for this story)