January-June warehousing space absorption up 60%

According to property consultant CBRE’ India Logistics and Industrial Market View for H1 2015, around 6 million sq ft was taken up by warehousing space occupiers, a growth of nearly 60 <g data-gr-id="42">per cent</g> from January-June 2014.

“An improving domestic economy and legislative reforms have been encouraging an increasing number of foreign firms to establish their manufacturing bases in India. Warehousing and food storage service providers have expressed particular interest in serving the growing industry needs of the country,” CBRE South Asia Chairman and MD Anshuman Magazine said.

He said the entry of multiple global brands may help raise the existing technological know-how in the field here to global standards and create more jobs in the sector. According to the report, demand for logistics and warehousing spaces was primarily concentrated in the Delhi National Capital Region (NCR) (27 percent), Mumbai (31 <g data-gr-id="35">per cent</g>) and Bangalore (18 <g data-gr-id="36">per cent</g>) while other cities saw stable transactions.

Close to 4.5 million sq ft was absorbed in these three cities during the period, registering a growth of around 103 <g data-gr-id="32">per cent</g> over the same period last fiscal. The main demand drivers, the report said, were third party logistics (3PL), e-commerce and fast moving consumer goods.

“Large urban centres such as Delhi NCR, Mumbai and Bangalore are likely to continue to remain the major hubs for retail distribution centres, while Pune and Chennai are likely to see healthy demand for industrial warehousing. Furthermore, with the implementation of GST, certain locations may witness a spillover in demand due to the sheer cost advantage,” Magazine said.

He said GST and e-commerce industry are expected to play a pivotal role in shaping future warehousing trends. “Driven by cost savings, instances of consolidation activity in the warehousing space have already been noted; and this trend is likely to gain further momentum across cities,” Magazine added.

Meanwhile, the real estate industry hailed the Government’s Thursday announcement of 98 Smart Cities but said that the Government should aggressively focus on effective implementation of these projects to stimulate economic growth and improve quality of urban life. The Confederation of Real Estate Developers’ Association of India (CREDAI) also demanded that the private sector should be roped in to realise this mission.

The Centre on Thursday released the names of 98 cities selected for the Rs 48,000-crore mega Smart Cities project. The remaining two names are pending. Uttar Pradesh has the maximum of 13 cities to be developed as smart cities, followed by 12 in Tamil Nadu, 10 in Maharashtra and 7 in Madhya Pradesh. “It is a good initiative by the <g data-gr-id="44">government</g> but this should be followed through aggressively so that the implementation of Smart Cities become a reality. <g data-gr-id="43">Private</g> sector should be roped in to realise this mission in whatever way possible,” CREDAI President Getamber Anand said.