India’s Industrial & Logistics Leasing Hits Record 27.1 Mn Sq. Ft. in H1 2025: CBRE

CBRE South Asia Pvt. Ltd., India’s leading real estate consulting firm, has reported a record 63% year-on-year (YoY) surge in Industrial & Logistics (I&L) leasing across India’s top eight cities during January–June 2025 (H1 2025), reaching an all-time high of 27.1 million sq. ft.

While the third-party logistics (3PL) sector maintained its lead with a 32% share of total leasing, the growth was largely driven by the e-commerce sector. E-commerce leasing more than doubled its share—from 9% in H1 2024 to 25% in H1 2025, boosted by rising consumer demand, faster delivery expectations, and preparations for the upcoming festive season.

The engineering and manufacturing (E&M) sector also saw a slight increase in I&L leasing, rising from 18% in H1 2024 to 19% in H1 2025. This growth is attributed to policy initiatives such as the Production Linked Incentive (PLI) scheme and Make in India 2.0, along with ongoing infrastructure developments, which have bolstered manufacturing and warehousing demand.

During Q2 2025, the I&L leasing witnessed a significant 86% Y-o-Y increase to 14.6 mn. sq. ft. The third-party logistics (3PL) sector continued to account for the highest share in I&L leasing during Q2 2025, at 33%. Leasing from e-commerce players during the period increased significantly, accounting for a 24% share, compared to 9% during the same period last year.

During Apr-Jun ‘25, the share of I&L leasing by corporates from the APAC, Americas, and EMEA regions rose to ~43% of the total leasing, compared to ~19% in Q2 2024.

Among the three regions, APAC-based companies recorded their highest space take-up at 2.7 mn. sq. ft. during Q2 2025 (up from 0.6 mn. sq. ft in Q2 2024), followed by American and EMEA-based firms at 1.9 mn. sq. ft. and 1.7 mn. sq. ft., respectively.

In H1 2025, I&L supply stood at 16.7 mn. sq. ft. Bengaluru, Chennai, and Mumbai emerged as the key contributors to this supply addition, collectively accounting for 57% of the total supply during this period.

Among cities, during H1 2025, Delhi-NCR led the demand with an absorption of 7.3 mn. sq. ft., followed by Bengaluru at 4.0 mn sq. ft. and Hyderabad at 3.6 mn. sq. ft. Cumulatively, the three cities accounted for almost 55% of the leasing volume.

Completions of I&L developments are expected to sustain momentum, owing to the launch of several high-profile projects backed by institutional investors.

Anshuman Magazine, Chairman & CEO, India, Southeast Asia, Middle East & Africa, CBRE, said, “The dominance of 3PL and e-commerce, which together drove over half of H1 demand, underscores how rapidly evolving consumer expectations and supply chain optimisation are reshaping the landscape. We foresee the next wave of growth being defined by premium, sustainable, and tech-enabled facilities, alongside accelerated expansion into tier-II cities to tap into underserved markets. This convergence of institutional capital, occupier demand, and infrastructure investment is setting the stage for a transformative decade for India’s logistics ecosystem.”

Ram Chandnani​, Managing Director, Leasing, CBRE India, said, “The robust growth in leasing activity, coupled with sustained institutional investments in quality assets, reflects the confidence of both occupiers and developers in India’s I&L sector. As occupiers focus on expanding their reach, particularly into tier-II cities, and developers prioritise sustainable and state-of-the-art facilities, we foresee a continued transformation in how warehousing and logistics networks are planned and executed.”