Warehouse rent surge: Bengaluru, Delhi-NCR among top 10 APAC cities
Bengaluru and Delhi-NCR are among the top 10 cities in the Asia-Pacific (APAC) region, with the highest increase in warehouse rent over the past 12 months. The 17-city list was compiled by real estate consultancy Knight Frank. Bengaluru saw a 7.5% rise, while Delhi-NCR experienced a 6.6% increase. However, these figures were lower than the 17-city average of 10.4%. Manila topped the list with a staggering 49.8% rise in warehouse rent.
India's warehousing sector maintains momentum
Knight Frank has reported that India's warehousing sector has maintained its strong performance, with transaction volumes in FY23 equaling the record-breaking levels of FY22. Although demand from the e-commerce sector has decreased, the third-party logistics (3PL) sector has compensated for the decline. The upcoming festive season is expected to boost e-commerce demand, while the manufacturing and 3PL sectors will continue to drive market growth.
Leasing transactions thrive amid e-commerce dip
Despite a drop in e-commerce demand, Mumbai and Bengaluru have experienced healthy growth in leasing transaction volumes as vacancies tightened rapidly over the last six months. Activity in Delhi-NCR slowed marginally but remained high compared to previous periods. The festive season is anticipated to bring a recovery in e-commerce demand, further contributing to the growth of India's warehousing sector.
Manila leads APAC in warehouse rent growth
Manila topped the list of APAC cities with a 49.8% rise in warehouse rent, followed by Sydney and Brisbane at 38.6% and 23.8%, respectively. In contrast, Shanghai and Beijing were the only two cities to experience rent declines, with decreases of 2% and 1.9%, respectively. Christine Li, head of research at Knight Frank Asia-Pacific, noted that the Chinese mainland market is diverging from the rest of the region as its economy continues to underperform.
