The warehousing market in Delhi-NCR has shown impressive growth, with the region recording 9.2 million square feet (mn sq ft) of warehousing transactions in 2024. This accounts for 16% of India’s total warehousing transactions, according to a recent report by Knight Frank India.
However, there’s even more room for growth. NCR has the potential to develop an additional 34.6 million sq ft of warehousing space, which is almost four times the volume recorded in 2024. This expansion capacity is due to the availability of unutilized land that is strategically positioned to meet rising demand in the coming years.
Key Factors Driving NCR’s Warehousing Growth
One of the major reasons behind NCR’s thriving warehousing sector is its well-developed road network, which connects Delhi with nearby cities and industrial hubs. Over time, this connectivity has led to the emergence of several warehousing clusters across the region.
Industry Insights: Who’s Leasing Warehousing Space?
In terms of industry-specific demand, the third-party logistics (3PL) sector emerged as the top contributor to NCR’s warehousing transactions in 2024, followed closely by the manufacturing sector. These sectors continue to drive demand as companies look for efficient storage and distribution solutions.
Top Warehousing Clusters in NCR
Among NCR’s various warehousing hubs, the NH48/Kundli Manesar Palwal Expressway (KMP) remains the dominant logistics cluster. It accounted for a staggering 77% of total leasing activity in 2024, up from 66% in 2023.
The Ghaziabad cluster has also shown notable improvement, increasing its share of transactions from 8% in 2023 to 13% in 2024. This indicates rising interest in warehousing facilities located in and around Ghaziabad.
Future Outlook: Sustained Growth Expected
According to Shishir Baijal, Chairman and Managing Director of Knight Frank India, NCR’s warehousing sector is poised for sustained growth due to ongoing infrastructure projects and increased demand from key industries.
He further highlighted that the resurgence of e-commerce, along with the rise of quick-commerce (q-commerce) and other complementary sectors, will continue to boost warehousing activity in the region over the next 2-3 years.
Rental Trends in NCR Warehousing
Despite fluctuations in demand, rental rates for NCR warehouses have remained stable. The average rent stands at Rs 21.3 per sq ft per month, with a modest growth of 2% recorded in 2024.
Among the various clusters, Greater Noida stands out as the most expensive warehousing location, with rental rates ranging between Rs 30-35 per sq ft per month for Grade A warehouses. This is due to Greater Noida’s advanced infrastructure and proximity to major industrial zones.
Conclusion
The NCR warehousing market is on an upward trajectory, driven by increasing demand from logistics, e-commerce, and manufacturing sectors. With ample land for future expansion, stable rental trends, and improved infrastructure, the region is well-positioned to remain a key player in India’s warehousing landscape. Businesses looking to expand their storage and distribution operations in NCR can benefit from this growing market in the years to come.
