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India’s industrial and logistics (I&L) real estate sector continues to show remarkable momentum. According to CBRE South Asia’s latest report India Market Monitor Q3 2025 – Industrial & Logistics, leasing activity grew by nearly 28% year-on-year during the first nine months of 2025 (January to September). The total space leased across the top eight Indian cities touched 37 million sq. ft., up from 28.8 million sq. ft. in the same period last year.
Delhi-NCR, Bengaluru, and Hyderabad Lead Activity
The National Capital Region (NCR) led the country in leasing volumes, recording 11.7 million sq. ft. of activity in 9M 2025. Bengaluru followed with 5.7 million sq. ft., and Hyderabad came in third with 4.6 million sq. ft. Together, these three cities accounted for nearly 59% of all leasing across India’s I&L markets.
Mumbai and Kolkata also performed well, with space take-up of 4.2 million sq. ft. and 3.8 million sq. ft., respectively. Chennai, Pune, and Ahmedabad contributed to the remaining share, reflecting steady demand across the country.
3PL and Quick Commerce Driving Growth
The report highlights that demand was primarily driven by Third-Party Logistics (3PL) firms and the rapid rise of quick commerce, companies offering fast, often same-day, deliveries. This trend has pushed businesses to prioritise efficient and well-located warehouses to meet customer expectations.
Anshuman Magazine, Chairman & CEO, India, South-East Asia, Middle East & Africa at CBRE, said that supply chain optimisation and resilience have become key focus areas for companies. “There’s a growing preference for sophisticated, high-specification Grade A facilities that can support automation and minimise last-mile delivery friction,” he noted.
This shift underscores a maturing logistics market, where modern infrastructure, technology integration, and proximity to urban centres are crucial to competitiveness.
Institutional Developers Expand Supply
Alongside strong leasing activity, new supply has also increased. During the first nine months of 2025, 23.8 million sq. ft. of fresh I&L space entered the market. Most of this new development came from institutional investor-backed developers who continue to expand aggressively in major hubs.
Bengaluru, Chennai, and Mumbai together accounted for about 62% of all new completions, reflecting both sustained occupier demand and developer confidence in the long-term growth potential of India’s logistics sector.
Ram Chandnani, Managing Director, Advisory & Transaction Services, India at CBRE, observed that this trend points to a more mature and diversified market. “The sustained demand from domestic corporates, coupled with robust new supply, shows how India’s logistics sector is increasingly aligning with the broader growth story of e-commerce and manufacturing,” he said.
Q3 2025 Snapshot: 3PL Players Dominate Leasing
In the July–September quarter (Q3 2025) alone, total I&L leasing touched 10.4 million sq. ft. Third-Party Logistics firms led the activity with a 40% share, followed by e-commerce players at 18%, and engineering and manufacturing companies at 15%.
Domestic corporates were the dominant occupiers, contributing 68% of total leasing during the quarter. European, Middle Eastern, and African (EMEA) corporates accounted for another 14%, indicating continued foreign interest in India’s growing logistics network.
Positive Outlook Ahead
Looking ahead, CBRE expects the momentum to continue through the final quarter of 2025. The festive season is likely to boost warehousing demand, while new supply from institutional developers is expected to hit the market soon. Pending deals are also likely to be finalised in the coming months.
The report predicts that 3PL and e-commerce players will remain the main growth engines for India’s logistics real estate sector, driven by their constant efforts to improve delivery timelines and streamline supply chains.
With India’s manufacturing and consumption base expanding rapidly, the demand for high-quality, strategically located logistics facilities is expected to stay strong. Developers are responding with larger, automated, and sustainable warehouses—reshaping the country’s industrial real estate landscape into one of the most dynamic growth stories in Asia.
