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Warehousing rentals in the Delhi-NCR region fell by 10% in the first half of 2025, reaching INR 21 per sq ft monthly, according to Vestian. This decline was largely due to a significant portion of leasing around 60% happening at below-average rental rates. While rental values stayed largely steady across India's top seven cities, Pune witnessed a 13% hike, leading the pack at INR 31 per sq ft per month. Meanwhile, investments in warehousing assets across the country saw a dramatic 98% annual dip, totaling only USD 32 million during the same period.
The Delhi-NCR region witnessed a notable 10% decline in warehousing rentals during the first six months of 2025, with monthly rates dropping to INR 21 per square foot, according to real estate consultancy Vestian. This fall was primarily attributed to nearly 60% of leasing transactions closing at rates below the region's average, pulling down overall rental values. Advertisement
While Delhi-NCR struggled, Pune emerged as the most expensive warehousing market among India's top seven cities, commanding a monthly rent of INR 31 per sq ft. This marked a 13% year-on-year increase, backed by robust demand from sectors such as third-party logistics (3PL), automotive, engineering, and manufacturing.
Chennai also registered growth, with rentals climbing 2% annually to INR 25 per sq ft. Kolkata followed closely, witnessing an 8% rise to INR 21 per sq ft. On the other hand, Bengaluru experienced a 5% drop, with rates settling at INR 19 per sq ft, the same as in Hyderabad, where there was only a marginal 1% increase.
Mumbai had the lowest warehousing rental among the top cities, at INR 18 per sq ft per month a 2% decline over the year.
Across the board, average rental values across the top seven markets ranged between INR 18-31 per sq ft per month, showing relative stability despite region-specific fluctuations.
However, the more pressing concern for the sector has been the steep decline in investments. Only USD 32 million was invested in warehousing assets during the first half of 2025 an alarming 98% fall compared to the previous year. This sharp drop signals hesitation among investors, possibly due to market uncertainties, changing demand patterns, and tighter funding environments.
Shrinivas Rao, CEO of Vestian, noted that while the first half of the year reflected weaker investment activity, underlying fundamentals remain strong. He highlighted continued demand in major markets, growing interest in sustainable and tech-driven warehousing, and rapid development of multimodal logistics hubs. He also pointed to policy support from initiatives like the Gati Shakti plan and growing traction in tier-2 and tier-3 cities as major growth enablers going forward.
Source PTI
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