India warehousing leasing activity across eight major markets increased 12 per cent year-on-year to 19.1 million square feet in Q3 2026, driven by manufacturing companies and third-party logistics (3PL) operators.
The July-September quarter recovery followed softer activity in the previous quarter, according to a report by Knight Frank India.
Higher manufacturing activity, expansion of outsourced logistics operations and inventory build-up ahead of the festive season supported demand.
The sector maintained growth despite geopolitical uncertainties and elevated oil and freight costs, the report said.
Manufacturing and 3PL drive warehousing demand
Manufacturing companies and 3PL operators accounted for 76 per cent of total warehousing demand during the quarter.
Manufacturing leasing increased 11 per cent year-on-year. Demand came from automotive, engineering, consumer durables and electrical equipment companies.
Leasing by 3PL operators grew 27 per cent as businesses increasingly outsourced warehousing and distribution operations. The shift helped companies seek greater operational flexibility amid volatile costs.
E-commerce and consumer sectors expand warehouse footprint
Consumer-focused sectors also increased their warehousing requirements ahead of the festive season.
E-commerce companies recorded a 5 per cent year-on-year increase in leasing activity during Q3 2026.
Fast-moving consumer goods (FMCG) occupiers recorded 101 per cent growth, while fast-moving consumer durables (FMCD) leasing rose 43 per cent.
The increase reflected higher demand for storage and distribution capacity across consumer-facing businesses.
Quality facilities and infrastructure key to future growth
Shishir Baijal, International Partner, Chairman and Managing Director of Knight Frank India, said manufacturing expansion and the growing role of specialised logistics providers were reshaping the warehousing market.
He said future growth would depend not only on leasing volumes but also on the availability of quality facilities near manufacturing and consumption centres.
Baijal added that access to suitable land, timely approvals and investment in modern infrastructure would be important to developing a warehousing ecosystem capable of supporting India’s changing supply chains.
