Large-sized leasing transactions emerged as the key growth driver for India’s industrial and warehousing real estate market in 2025, accounting for nearly 45% of the total demand, according to the latest
report by Colliers India.
Industrial and warehousing demand across the top eight Indian cities touched 36.9 million square feet during 2025, marking a 16% year-on-year increase and making it one of the strongest performances in recent years. A sharp rebound in activity during the October–December quarter played a crucial role, with Q4 alone accounting for about 10.4 million square feet of leasing, up 30% from the year-ago period.
Delhi NCR and Chennai emerged as the biggest demand centres during the year, together contributing 46% of the total leasing activity. While Delhi NCR led with a 24% share, Chennai followed closely with 22%. On a quarterly basis, Chennai and Pune dominated the October–December period, cumulatively accounting for 56% of the demand in Q4 2025.
Third-party logistics (3PL) players continued to be the backbone of leasing activity, accounting for nearly one-third of the annual demand, or around 12 million square feet of Grade A space. Engineering and e-commerce firms also gained traction, and together made up about 35% of total leasing during the year, highlighting the broad-based nature of occupier demand.
At the micro-market level, Bhiwandi in Mumbai recorded the highest leasing activity in 2025, with around 4.9 million square feet of Grade A space absorption. This was followed by Chakan–Talegaon in Pune and Oragadam in Chennai, each clocking over 2.5 million square feet of demand within their respective cities.
New supply kept pace with rising demand. Developers delivered about 41.7 million square feet of industrial and warehousing space during 2025, reflecting a 15% annual increase and the highest level of completions in recent years. The strong supply pipeline indicates continued confidence among developers in the sector’s long-term growth prospects.
Commenting on the trend, Vijay Ganesh, Managing Director, Industrial & Logistics Services, Colliers India, said, “A strong performance in the last quarter has propelled the demand for Grade A industrial & warehousing space to around 37 million sq ft in 2025, highest in recent years. Space uptake was driven by large deals, especially by 3PL firms which accounted for almost one-third of the leasing activity in the year.” He added that the completion of over 40 million square feet during the year underscores developers’ optimism, supported by the government’s continued push on manufacturing and logistics infrastructure.
Large-ticket transactions — defined as deals of 200,000 square feet or more — played a decisive role across major markets. Such deals accounted for about 45% of overall leasing in 2025, with 3PL firms taking the largest share, followed by e-commerce and engineering companies. Cities such as Mumbai, Delhi NCR and Chennai saw over half of their leasing activity coming from large-sized transactions.
The report also highlights diverging deal-size preferences across sectors. Within the e-commerce segment, around 61% of space uptake on a quarterly basis came through large deals, driven by the need for large fulfilment centres and delivery hubs. In contrast, more than two-thirds of leasing by FMCG and retail players fell in the mid-sized category of 100,000–200,000 square feet, reflecting the rise of hyperlocal delivery models.
Looking ahead, Vimal Nadar, National Director and Head of Research at Colliers India, said Delhi NCR and Chennai each recorded over 8 million square feet of demand in 2025, while Pune and Mumbai saw leasing of around 5 million square feet each. “With well-established manufacturing clusters and superior infrastructure connectivity, we expect these markets to cumulatively account for 70-80% of industrial & warehousing demand in 2026 as well,” he said.
With large deals, strong occupier interest from logistics and manufacturing-linked sectors, and a healthy supply pipeline, India’s industrial and warehousing market appears well positioned for sustained growth in the coming years.
