India’s Grade-A industrial and warehousing leasing rose 26% year-on-year to 33.3 million sq ft during January–September 2026, up from 26.5 million sq ft in the corresponding period last year, driven by strong automobile-sector demand, expanding logistics requirements and growing institutional investment, according to Colliers India.
Third-party logistics (3PL) companies accounted for more than 11 million sq ft of leasing, representing approximately one-third of total demand. Engineering companies followed with 6.6 million sq ft, or around 20% of the market.
The automobile sector recorded the fastest growth, with leasing demand increasing 70% year-on-year. E-commerce, electronics and engineering occupiers also registered growth of approximately 30%, reflecting the broadening demand base for industrial and logistics real estate.
Large transactions remained a significant market driver, with deals exceeding 200,000 sq ft accounting for 37% of total leasing. E-commerce and logistics companies contributed 58% of these large transactions.
“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,” said Vimal Nadar, National Director and Head of Research at Colliers India.
Quarterly Leasing Gains Momentum
Industrial and warehousing leasing accelerated during the July–September quarter, rising 63% year-on-year from 7 million sq ft to 11.4 million sq ft. New supply, meanwhile, increased marginally by 2%, from 9.6 million sq ft to 9.8 million sq ft.
Quarterly leasing exceeded new completions by 1.6 million sq ft, indicating stronger absorption during the period. However, for the first nine months of 2026, new supply reached 34.5 million sq ft, exceeding leasing by 1.2 million sq ft.
Vijay Ganesh, Managing Director, Industrial & Logistics Services at Colliers India, said Delhi NCR and Chennai together accounted for half of the third-quarter leasing activity. Bengaluru and Pune also recorded substantial increases, with leasing rising two- to four-fold, depending on the market.
Colliers expects India’s full-year industrial and warehousing leasing to reach 40–45 million sq ft. Its figures exclude lease renewals, pre-commitments and transactions supported only by letters of intent.
Delhi NCR and Chennai Lead Leasing
Delhi NCR recorded leasing of 9.3 million sq ft during January–September, up 26% from 7.4 million sq ft a year earlier. Chennai increased 25% to 6.4 million sq ft from 5.1 million sq ft. Together, the two markets accounted for 47% of national leasing demand.
Farukh Nagar and the NH 48 corridor in Delhi NCR, along with Bhiwandi in the Mumbai market, accounted for almost one-third of total national leasing.
Pune emerged as another strong market, with leasing increasing 70% to 3.4 million sq ft from 2 million sq ft. Bengaluru recorded a 61% rise, reaching 4.5 million sq ft compared with 2.8 million sq ft in the corresponding period last year.
Seven of the eight markets tracked by Colliers recorded higher leasing, with Mumbai the only exception. Leasing in Mumbai declined 14% to 3.6 million sq ft from 4.2 million sq ft.
Supply Expands Across Key Markets
New industrial and warehousing supply increased 19% year-on-year to 34.5 million sq ft during January–September 2026, compared with 29 million sq ft in the same period last year.
Pune recorded a 105% increase in new supply, from 2.2 million sq ft to 4.5 million sq ft, while Ahmedabad registered a 160% jump, from 1.5 million sq ft to 3.9 million sq ft.
Mumbai also witnessed a substantial increase in supply, rising 41% to 6.2 million sq ft from 4.4 million sq ft, despite the decline in leasing activity. The divergence between leasing and completions highlights the importance of matching new development with occupier demand across individual markets.
Institutional Investors Strengthen Market Confidence
Investor interest in India’s industrial and logistics real estate sector remained strong, with major transactions highlighting the growing appetite for established, income-generating warehousing assets.
On October 7, Brookfield announced a ₹4,300-crore commitment to acquire and develop eight industrial and logistics parks associated with ESR India. The portfolio spans approximately 10.5 million sq ft across five major markets, with the transaction largely involving existing properties.
The deal follows IndoSpace Core’s acquisition of six logistics parks for ₹3,000 crore in late 2025, backed partly by Canadian pension fund CPP Investments.
Together, the two transactions represent a reported deal value of ₹7,300 crore, underscoring the increasing participation of global institutional investors in India’s logistics infrastructure and warehousing market.
With third-party logistics operators continuing to anchor demand, automobile and manufacturing occupiers expanding their footprint, and institutional capital flowing into logistics assets, India’s industrial and warehousing sector is positioned for further growth. The pace of new supply, regional demand patterns and the availability of well-located, modern facilities will remain key factors shaping market performance in the final quarter of 2026.