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India’s industrial and logistics sector has posted its strongest quarter ever, with gross absorption reaching 21.3 million sq. ft. in Q3 2025, according to Savills India.
Cumulative absorption for the first nine months of 2025 touched 55.3 million sq. ft., up 23.4% YoY, while new completions rose 11.9% YoY to 21.6 million sq. ft. This brings the YTD supply to 55.0 million sq. ft., reinforcing India’s position as one of the world’s fastest-growing industrial and warehousing markets.
“India’s industrial and warehousing sector is entering a defining phase, with 2025 and 2026 expected to set new benchmarks in both demand and supply. The sector is undergoing a significant transformation, driven by the expansion of manufacturing, rising demand for modern Grade-A distribution facilities, and the rapid development of Tier-II and Tier-III cities. Government initiatives, coupled with inclusive policies focused on infrastructure and manufacturing, have attracted positive responses globally bringing in increased equity and investor confidence. As a result, India is steadily emerging as a global hub, repositioning itself as a key industrial and distribution destination,” said Srinivas N, Managing Director, Industrial & Logistics, Savills India.
Delhi-NCR led absorption with 21%, followed by Mumbai and Pune at 15% each, and Bengaluru at 11%. On the supply side, Mumbai contributed 18%, with Delhi-NCR and Pune at 15% each, and Bengaluru at 14%.
Manufacturing-led absorption rose to 27% in Q3 2025, up from 16% in Q3 2024, while Tier-II and Tier-III cities gained traction as sourcing, consumption, and distribution hubs.
Looking ahead, Savills projects supply and absorption to surpass 70 million sq. ft. in 2025, driven by 3PL, manufacturing, retail, FMCG, and FMCD. The rise of e-commerce is deepening distribution networks beyond metros, while demand for Grade-A facilities continues to grow, backed by quality, compliance, and investor confidence.
