Contact Your Financial Adviser Money Making MC
18 February 2019
 |
| Top 5 Markets (The Total Investment & Insurance Solutions) |
Riding on structured reforms including the
infrastructure NSE -0.34 % status and the implementation of Goods &
Services Act, Indian warehousing and logistics sector is estimated to attract
nearly $10 billion investments over the next 4-5 years. With addition of around
200 million sq ft warehousing space across India, total supply is expected to
nearly double by 2022, estimated JLL India.
With e-commerce players expanding operations
across the country, there has been a corresponding rise in demand for space
from these companies in both tier I and II markets and this is expected to add
to robust growth in Delhi NCR, Mumbai, Pune, Bengaluru and Chennai markets.
“Warehousing and logistics sector has been growing steadily since 2017, when it
was granted an infrastructure status. Structured reforms such as the
implementation of Goods and Services Act, the formation of a Logistics
Department under the ministry of commerce and industry and various other policy
changes have directly or indirectly resulted in sector’s growth of the sector,”
said N Srinivas, managing director, industrial services, JLL India.
A key trend emerging now is the growing
demand for warehousing and logistics space from tier II cities like Coimbatore,
Guwahati, Lucknow, Jaipur & Ludhiana. While the year 2018 witnessed a 22%
year-onyear growth in total stock in Grade A & B warehousing space in top
eight cities at 169 million sq ft compared to 138 million sq ft ft year ago,
absorption clocked an unprecedented growth of 60% year-on-year growth to nearly
32 million sq ft last year from around 20 million sq ft in 2017. The robust
growth in absorption reflects demand outstripping supply significantly and
vacancies dropping below 10% level for the first time ever, showed data from
JLL India. With 24% share of total platform level investments in India in 2018,
warehousing and industrial segment is expected to retain strong momentum over
the next few years
A number of private Indian developers are
already considering investments into the investable grade real estate. These
include Musaddilal, Panchshil, GWC, FWS, Hiranandani, Lodha Group, Jalan Group,
Srijan, Apeejay, AllCargo among others. Established and newer foreign funds-managed
developers are considering different entry strategy. These include joint
ventures, joint developments and acquisition of existing portfolio.
Some of these names include Altico Capital,
Ascendas FirstSpace, ESR, Hindustan Infralog (DP World + NIIF), IndoSpace,
Embassy, LOGOS India, Morgan Stanley and Proprium. Among sectors, third-party
logistics (3PL) companies, ecommerce, auto & ancillary, retail and fast
moving consumer goods (FMCG) companies accounted for around 60% of the
absorption during the year. Delhi NCR, Mumbai, Pune, Bengaluru and Chennai
continued to be the top five markets in terms of demand & absorption.
While Chennai, Pune and Ahmedabad registered
significant demand from the manufacturing sector, Kolkata emerged as a major
logistics hub due to its consumption and distribution advantage. “A dearth of
good quality and ready supply in the market has forced occupiers to go for
Built-to-Suit (BTS) developments that accounted for almost 26% of total
absorption in 2018. However, in line with the demand and requirements, the
developers are also aligning themselves to focus on creating quality spaces,”
Srinivas said. The year 2019 has started on a positive note for the sector.The Total Investment & Insurance
Solutions
No comments:
Post a Comment