India warehousing market set to record highest ever net absorption in 2022

Demand for warehouses has seen a healthy incline in India and the robust deal pipeline indicates a record net absorption of 42.5 million sq ft in 2022 as against 39 million sq ft a year ago, showed a JLL India study. Third-party logistics (3PL) and logistics has remained the largest sector in terms of warehousing demand over the years. Due to a behavioral change from making offline purchases to online, demand for e-commerce has gained significant traction over the last few years. However, the demand from e-commerce players has cooled down in the first half of 2022, given that e-commerce players have added adequate capacity in 2021. With rising disposable incomes and consumption-led demand, retail demand expanded strongly in the first half of 2022. Engineering and auto and ancillaries are the other main drivers of demand, since manufacturing companies have been incentivized with favourable government policies to attract multinational companies (MNCs) as well as domestic investments.