India’s warehousing sector is undergoing a structural transformation, shifting from fragmented regional clusters to a more integrated and professionally managed asset class.
Total warehousing stock across the country’s top eight Tier 1 cities and 14 emerging Tier 2+ markets has reached 610 million square feet in 2025, with net absorption touching a record 67 million square feet. The figures underline not only strong demand but also a broadening geographic footprint that is redefining the logistics landscape.
While Tier 1 cities continue to account for 82% of overall stock, the momentum is increasingly visible in smaller urban centres. The 14 emerging Tier 2+ markets now make up 18% of total inventory and recorded 12 million square feet of absorption this year. Analysts say this signals a decisive shift in how companies are designing supply chains.
Cities such as Chandigarh-Rajpura, Lucknow, Nagpur and Coimbatore are increasingly viewed as strategic logistics hubs rather than secondary alternatives. Lower land costs, improving infrastructure and proximity to consumption centres are drawing occupiers seeking operational efficiency and cost optimisation.
At the same time, quality is emerging as a key differentiator. Grade A facilities now account for 53% of total warehousing stock and captured 80% of leasing activity in 2025. The preference reflects rising expectations around automation, compliance standards and supply chain resilience, where technology-enabled infrastructure is becoming critical to competitiveness.
Institutional investors have responded accordingly, backing 38% of Grade A developments. Their participation has brought greater standardisation and transparency to the sector, strengthening confidence among occupiers and developers alike.
Taken together, the trends suggest that India’s warehousing market is entering a more mature phase—one driven not only by scale, but by technology, quality and geographic diversification.
