Mumbai’s warehousing sector, specifically the Mumbai Metropolitan Region (MMR), recorded the highest transaction volume of 9.5 million square feet in the last seven years for the financial year 2022-23. This accounts for a 10% growth compared to the previous year’s transaction volume of 8.6 million square feet. The report, India Warehousing Market Report 2023, highlights that the increase is due to an improved occupier sentiment and steady demand for high-quality assets. There has also been an increase in consumer demand.
Third-party logistics companies still dominate the MMR’s warehousing sector with a 52% share in the warehousing transactions. This is 6% lower compared to the previous year. Surprisingly, the share of the e-commerce sector declined from 22% to 6% in the same period, while the retail sector rose from 2% to 16%. According to the report, miscellaneous sectors like telecom and real estate increased their share to 11% from 2% in the previous year.
Bhiwandi, a prominent warehousing hub in Mumbai, accounted for 96% of the total transacted volume during the financial year 2022-23. The land value of Bhiwandi has also appreciated in Lonad, Bhoirgaon, and Dhohare in the cluster. Another emerging warehousing cluster is Panvel, which is aimed at Jawaharlal Nehru Port Trust (JNPT) and the upcoming Navi Mumbai International Airport. The land value in the Panvel cluster ranges from ₹18-40 mn/acre, whereas land value in Bhiwandi varies from ₹18-28 mn/acre.
Knight Frank India’s Chairman and Managing Director, Shishir Baijal, emphasized the key role of third-party logistics providers and manufacturing companies in the warehousing sector. As these occupiers take the lead, their evolving needs and preferences regarding warehousing requirements have become significant factors. Mr. Baijal also added that flexibility, scalability, and customization options are crucial for meeting the occupier’s evolving requirements.
The report also highlighted that Bhiwandi is still the preferred warehousing cluster for occupiers, with rental values ranging from ₹205-269 sq m/month for Grade-A spaces. However, the good quality Grade-A spaces offered by the Panvel cluster is expected to drive demand in the region despite several bottlenecks.
