Bengaluru, Oct 22: Strong occupier traction continued to drive industrial & warehousing demand across the top 8 cities of the country during the first nine months of 2026. Grade A leasing touched 33.3 million sq ft, a robust 26% YoY increase. Amongst the major cities, Delhi NCR & Chennai remained at the forefront, together constituting nearly half of the overall demand in the first three quarters of the year. Meanwhile, Pune & Bengaluru particularly witnessed strong momentum, with space uptake rising annually by 60-70%. These two cities cumulatively drove close to 8 million sq ft of demand during Jan-Sep 2026. Overall, the eight leading markets remained fundamentally strong & resilient, with seven of them registering higher demand in Jan-Sep 2026 compared to the corresponding period of 2025.
Third-party logistics firms dominated overall leasing in most cities, accounting for nearly one-third of the total demand, followed by engineering segment with a share of 20% during Jan-Sep 2026. Amongst the key clusters, Farukh Nagar & NH 48 in Delhi NCR and Bhiwandi in Mumbai continued to be high-activity markets, cumulatively accounting for almost one-third of the Year-to-Date leasing.
During Q3 2026, industrial & warehousing space uptake surpassed 11 million sq ft, a robust 63% YoY growth. The quarter recorded the highest leasing activity in recent years, highlighting the sector's resilience despite re-escalation in the ongoing West Asia crisis, supply chain disruptions and trade realignments.
Trends in Grade A Gross absorption (million sq ft)
|
City |
Q3 2026 |
Q3 2025 |
YoY change |
YTD 2026 |
YTD 2025 |
YoY change |
|
Ahmedabad |
0.6 |
0.5 |
20% |
2.2 |
1.7 |
29% |
|
Bengaluru |
2.0 |
0.8 |
150% |
4.5 |
2.8 |
61% |
|
Chennai |
2.3 |
1.4 |
64% |
6.4 |
5.1 |
25% |
|
Delhi NCR |
3.4 |
1.8 |
89% |
9.3 |
7.4 |
26% |
|
Hyderabad |
0.5 |
0.6 |
-17% |
1.8 |
1.7 |
6% |
|
Kolkata |
0.8 |
0.6 |
33% |
2.1 |
1.6 |
31% |
|
Mumbai |
0.9 |
1.1 |
-18% |
3.6 |
4.2 |
-14% |
|
Pune |
0.9 |
0.2 |
350% |
3.4 |
2.0 |
70% |
|
TOTAL |
11.4 |
7.0 |
63% |
33.3 |
26.5 |
26% |
“India’s industrial & warehousing sector witnessed significant demand acceleration during Q3 2026, with leasing volumes surging by 63% YoY to 11.4 million sq ft of Grade A space. Demand continued to be anchored by Delhi NCR & Chennai, which together accounted for half of the quarter’s absorption, while Bengaluru & Pune emerged as high-growth markets, recording 2-4X times increase in leasing volumes on a yearly basis. The strong performance across key markets positions the sector to achieve 40-45 million sq ft of leasing in 2026." says Vijay Ganesh, Managing Director, Industrial & Logistics Services, Colliers India.
3PL firms remained the prominent demand driver followed by engineering firms
3PL players retained their position as the largest occupier segment during Jan-Sep 2026, with over 11 million sq ft of space uptake, nearly one-third of India’s industrial & warehousing demand. This was followed by engineering segment which had a 20% demand share and contributed 6.6 million sq ft of space uptake. Notably, automobile firms recorded the strongest growth amongst occupier segments, with Grade A space uptake surging 70% YoY. Overall, the momentum in leasing across demand segments remained noteworthy, with e-commerce, electronics & engineering segments registering close to 30% annual growth each during the first nine months of 2026.
Large sized deals account for nearly 37% of industrial & warehousing space uptake
During Jan-Sep 2026, large deals (>200,000 sq ft) constituted around 37% of the overall demand across the top 8 markets of the country. Majority of these larger deals came from e-commerce and 3PL occupiers, which together comprised around 58% of such large deals during the first nine months of 2026. At the city level, Delhi NCR dominated large-sized transactions, followed by Chennai.
“The industrial & warehousing sector maintained strong momentum in Jan-Sep 2026, led by robust demand from both logistics and manufacturing occupiers. While 3PL firms accounted for about one-third of overall leasing, engineering and e-commerce firms accounted for 15-20% share in leasing each. The broadening occupier base highlights the sector’s increasing diversification, reducing reliance on a single demand segment and reinforcing the market’s long-term growth prospects. This diversified demand profile, coupled with ongoing manufacturing expansion and supply chain investments, is expected to sustain healthy leasing activity across India’s key industrial and warehousing markets.” says Vimal Nadar, National Director & Head of Research, Colliers India.
New supply remained robust across top 8 cities, up 19% on an annual basis
Supply additions reached 34.5 million sq ft during Jan-Sep 2026, a 19% YoY rise, reflecting sustained developer confidence across the top eight cities. Completions were seen across key markets, led by Delhi NCR, Chennai & Mumbai, which collectively contributed 55% of the new supply during Jan-Sep 2026.
Ahmedabad & Pune witnessed more than two-fold increase in completions compared to corresponding period of 2025. Importantly, six of the eight major cities recorded annual growth in new supply, underscoring the prevailing optimism and positive sentiment even in the wake of ongoing regional conflicts.
Trends in Grade A Supply (million sq ft)
|
City |
Q3 2026 |
Q3 2025 |
YoY change |
YTD 2026 |
YTD 2025 |
YoY change |
|
Ahmedabad |
1.6 |
0.4 |
300% |
3.9 |
1.5 |
160% |
|
Bengaluru |
1.1 |
0.9 |
22% |
4.4 |
2.4 |
83% |
|
Chennai |
2.1 |
2.3 |
-9% |
6.3 |
5.8 |
9% |
|
Delhi NCR |
1.2 |
2.8 |
-57% |
6.6 |
9.0 |
-27% |
|
Hyderabad |
0.5 |
0.8 |
-38% |
1.8 |
1.7 |
6% |
|
Kolkata |
0.3 |
0.7 |
-57% |
0.8 |
2.0 |
-60% |
|
Mumbai |
1.6 |
1.0 |
60% |
6.2 |
4.4 |
41% |
|
Pune |
1.4 |
0.7 |
100% |
4.5 |
2.2 |
105% |
|
TOTAL |
9.8 |
9.6 |
2% |
34.5 |
29.0 |
19% |
Vacancy levels rose marginally to 16% at the end of Q3 2026, as supply additions outpaced cumulative demand during the first three quarters of the year. Average rentals, meanwhile, remained largely stable across the top eight cities. Select high-activity micro-markets, however, continued to record rental appreciation, supported by sustained demand for premium developments.
