India’s warehousing sector witnessed a strong recovery in the July-September quarter of 2026 (Q3 CY26), with leasing activity across eight major markets increasing 12 per cent year-on-year to 19.1 million square feet, driven by robust demand from manufacturing companies and third-party logistics (3PL) operators, according to a report by Knight Frank India.
The growth marks a recovery from the softer performance in the previous quarter and was supported by increased manufacturing activity, expanding outsourced logistics operations and inventory accumulation ahead of the festive season. The sector maintained its resilience despite geopolitical uncertainties and elevated oil and freight costs.
Manufacturing companies and 3PL operators together accounted for 76 per cent of total warehousing demand during the quarter. Manufacturing-led leasing grew 11 per cent year-on-year, supported by demand from the automotive, engineering, consumer durables and electrical equipment sectors.
Meanwhile, leasing by 3PL operators surged 27 per cent, reflecting the growing preference among businesses to outsource warehousing and distribution operations to improve operational flexibility and manage volatile costs.
Consumer-oriented sectors also recorded increased demand ahead of the festive season. Leasing by e-commerce companies rose 5 per cent year-on-year, while demand from fast-moving consumer goods (FMCG) and fast-moving consumer durables (FMCD) occupiers increased sharply by 101 per cent and 43 per cent, respectively.
Shishir Baijal, International Partner, Chairman and Managing Director of Knight Frank India, said the country’s warehousing market is being reshaped by the twin drivers of domestic manufacturing expansion and the increasing role of specialised logistics providers.
He emphasised that the next phase of growth would depend not only on leasing volumes but also on the availability of quality warehousing facilities in locations serving key manufacturing and consumption centres.
Baijal added that access to suitable land, timely regulatory approvals and investments in modern infrastructure would be critical to developing a robust warehousing ecosystem capable of supporting India’s evolving supply chains.