Pune: India’s warehousing absorption continued to gain momentum in the first nine months of 2026, with net absorption across the country’s top eight cities increasing 16.2% year-on-year to 49.5 million sq ft, compared with 42.6 million sq ft during the corresponding period of 2025.
Cumulative net absorption between 2021 and 9M 2026 reached approximately 266.5 million sq ft, reflecting sustained occupier demand in the country’s warehousing and industrial real estate market.
According to ANAROCK Research & Advisory, the growth in warehousing absorption remains concentrated in a few major markets, with the National Capital Region (NCR), Mumbai Metropolitan Region (MMR) and Pune together accounting for nearly 58% of cumulative absorption across the top eight cities since 2021.
Peush Jain, Managing Director – Commercial Leasing & Advisory, ANAROCK Group, says, “These are encouraging numbers, but the fact is that India’s warehousing growth remains concentrated in just a few markets.
Also, rental appreciation and vacancy levels vary markedly across cities. NCR, MMR and Pune together accounted for nearly 58% of cumulative absorption across the top 8 cities.”
NCR emerged as the largest contributor to cumulative warehousing absorption, with a 21.8% share, followed by MMR at 18.5% and Pune at 17.4%.
Pune has overtaken Bengaluru to become the third-largest warehousing market by cumulative absorption. Bengaluru accounted for a 15.1% share.
Among the other markets, Chennai accounted for 10.7% of cumulative absorption, while Kolkata contributed 7.7%. Hyderabad and Ahmedabad each recorded a 4.4% share.
NCR Records the Sharpest Rental Increase
India’s average monthly warehousing rents across the top eight cities stood at ₹28.1 per sq ft in Q3 2026, marking a 27% increase since 2021.
NCR recorded the sharpest rental appreciation among the eight markets, with average monthly rents increasing from ₹22.2 per sq ft in 2021 to ₹33 per sq ft in Q3 2026, representing a 49% rise.
“Among the cities, NCR recorded the sharpest rental appreciation among the top 8 cities,” says Peush Jain.
“Average monthly rents in the National Capital Region increased from INR 22.2 per sq ft in 2021 to INR 33 per sq ft in Q3 2026 – a rise of 49%.
The increase has been particularly pronounced in recent years. Rents grew by just 3% between 2021 and 2023 and then zoomed to 44% from 2023 to Q3 2026.”
The rental increase in NCR has accelerated considerably since 2023, with rents rising 44% between 2023 and Q3 2026, compared with just 3% between 2021 and 2023.
MMR continued to command the highest average monthly warehousing rent among the top eight cities at ₹43.9 per sq ft. In contrast, Ahmedabad recorded the lowest average rent at ₹19 per sq ft.
Hyderabad, MMR and Bengaluru registered rental increases of 30% or more since 2021. Meanwhile, Pune, Chennai and Ahmedabad recorded comparatively moderate rental appreciation of 17%, 19% and 20%, respectively.
Vacancy Rate Stands at 7.9% Nationally
India’s national warehousing vacancy rate stood at 7.9% as of 9M 2026. The figures indicate differences in supply availability across the country’s major warehousing markets despite the overall increase in occupier demand.
Pune emerged as the tightest warehousing market among the top eight cities, recording the lowest vacancy rate at 6.8%. Chennai and Kolkata followed at 7.1% each, while NCR reported 7.3% and MMR recorded 7.6%.
On the other hand, Bengaluru recorded the highest vacancy rate at 11.5%, followed by Ahmedabad at 11% and Hyderabad at 9.2%.
Interestingly, Bengaluru’s relatively high vacancy rate has coexisted with a 30% increase in average rents since 2021. Pune, despite recording the lowest vacancy, has witnessed the slowest rental appreciation among the eight markets.
“This underlines the importance of factors beyond just vacancy in determining rental performance, including the quality and location of available stock, occupier requirements, and the nature of industrial activity in each market,” says Jain.
3PL and Manufacturing Account for Nearly 48% of Demand
Sectoral demand patterns indicate that third-party logistics (3PL) and manufacturing continue to be the primary contributors to India’s warehousing absorption.
At the national level, 3PL accounted for 26% of total warehousing demand, followed by manufacturing at 22% and the automotive sector at 10%.
Together, 3PL and manufacturing contributed 48% of national demand, highlighting the importance of logistics networks and industrial activity in driving the sector.
However, the demand composition varies considerably across individual cities, reflecting their respective industrial and logistics specialisations.
MMR: Logistics Remains the Primary Demand Driver
Mumbai Metropolitan Region continues to be a logistics-oriented warehousing market, with third-party logistics accounting for 40% of its total warehousing demand.
Manufacturing contributed 16%, while retail accounted for 11% of demand in the region.
Pune: Manufacturing and Automotive Drive Warehousing Absorption
Pune’s warehousing demand is primarily driven by manufacturing and automotive activities, which account for 32% and 22% of the city’s total demand, respectively. Third-party logistics contributes another 16%.
The city also accounted for 37% of all automotive-sector warehousing absorption across the top eight cities between 2021 and Q3 2026.
Pune’s growing share of cumulative warehousing absorption, combined with its relatively low vacancy rate, makes it one of the significant markets in India’s industrial real estate landscape.
Chennai: Electronics Contributes the Highest Share
Chennai’s industrial ecosystem is reflected in its warehousing demand composition. Electronics accounted for 14% of the city’s total warehousing demand, the highest share in this segment among the eight cities.
Manufacturing contributed 28%, while 3PL accounted for 26%.
Hyderabad: Manufacturing-Led Market
Hyderabad’s warehousing demand is predominantly manufacturing-led, with the sector contributing 31% of total demand.
Third-party logistics accounted for 13%, the lowest 3PL contribution among the analysed markets, while retail contributed 12%.
Kolkata: Strong Contribution from Logistics
Kolkata continues to be a logistics-oriented warehousing market, with 3PL accounting for 36% of its total demand.
Manufacturing contributed 18%, while retail accounted for 13%.
NCR: Diversified Demand Across Sectors
NCR recorded a more diversified warehousing demand profile, led by third-party logistics at 26%, manufacturing at 17% and retail at 13%.
Ahmedabad: Demand from Logistics, Manufacturing and Automotive
Ahmedabad’s warehousing demand was distributed across 3PL, manufacturing and automotive occupiers, which contributed 28%, 22% and 21%, respectively.
City-Wise Absorption, Rentals and Vacancy Rates
ANAROCK Research & Advisory’s data highlights the differences in cumulative warehousing absorption, sectoral demand, rental values and vacancy levels across India’s top eight cities.
| City | Share of National Absorption | Top Three Sectors (% of City Demand) | Average Rent Q3 2026 (₹/sq ft/month) | Rent Change Since 2021 | Vacancy Q3 2026 |
|---|---|---|---|---|---|
| NCR | 21.80% | 3PL 26%, Manufacturing 17%, Retail 13% | 33 | 49% | 7.30% |
| MMR | 18.50% | 3PL 40%, Manufacturing 16%, Retail 11% | 43.9 | 31% | 7.60% |
| Pune | 17.40% | Manufacturing 32%, Auto 22%, 3PL 16% | 27.4 | 17% | 6.80% |
| Bengaluru | 15.10% | Manufacturing 23%, 3PL 20%, Retail 11% | 26.6 | 30% | 11.50% |
| Chennai | 10.70% | Manufacturing 28%, 3PL 26%, Electronics 14% | 27.7 | 19% | 7.10% |
| Kolkata | 7.70% | 3PL 36%, Manufacturing 18%, Retail 13% | 24.7 | 22% | 7.10% |
| Hyderabad | 4.40% | Manufacturing 31%, 3PL 13%, Retail 12% | 23.4 | 31% | 9.20% |
| Ahmedabad | 4.40% | 3PL 28%, Manufacturing 22%, Auto 21% | 19 | 20% | 11.00% |
| Pan India | 100% | 3PL 26%, Manufacturing 22%, Auto 10% | 28.1 | 27% | 7.90% |
Source: ANAROCK Research & Advisory
Growth Outlook for India’s Warehousing Market
The latest trends indicate that India’s warehousing and industrial real estate market continues to expand, although the benefits of this growth are not evenly distributed across cities.
NCR has emerged as the standout market in terms of rental appreciation, with average rents increasing 49% since 2021. Pune combines a significant share of national warehousing absorption with the lowest vacancy rate among the top eight cities.
MMR continues to command the highest average warehousing rent, supported by its logistics-oriented demand profile. Meanwhile, Bengaluru’s higher vacancy rate indicates greater availability of warehousing space despite considerable rental growth.
Peush Jain said that city-level industrial specialisation, logistics requirements, the availability of suitable warehousing stock and the balance between new supply and occupier demand will play an important role in determining the market’s future performance.
“Going forward, city-level industrial specialisation, logistics requirements, the availability of suitable warehousing stock and the balance between new supply and occupier demand will determine this market’s performance,” says Peush Jain.
“For occupiers, the differences across markets may influence location and cost decisions. For developers and investors, they underline the need to assess individual market fundamentals rather than rely solely on national demand growth.”
As India’s warehousing market enters its next expansionary phase, occupier demand, the composition of industrial activity and the availability of suitable space are expected to remain important factors shaping the sector’s performance.
