Mumbai, 4 November 2026: India’s warehousing and industrial real estate market continued to expand in 9M 2026, with net absorption across the top 8 cities rising by 16.2% year-on-year to 49.5 Mn sq ft, compared with 42.6 Mn sq ft in the corresponding period of 2025. Cumulative net absorption between 2021 and 9M 2026 reached 266.5 Mn sq ft, highlighting the scale of occupier demand over the past five years.
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 led with a 21.8% share, followed by MMR at 18.5% and Pune at 17.4%. Pune has overtaken Bengaluru, which accounted for 15.1% of cumulative absorption. Meanwhile:
Chennai’s share stood at 10.7%, while Kolkata comprised 7.7% share.
Both Hyderabad and Ahmedabad comprised a 4.4% share each.
Source: Anarock Research & Advisory
NCR Leads Rental Appreciation
The national average monthly warehousing rents across the top 8 cities stood at INR 28.1 per sq ft in Q3 2026 – a notable 27% increase since 2021.
“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.”
MMR continues to command the highest average rent at INR 43.9 per sq ft per month, more than twice of Ahmedabad’s – which, at INR 19 per sq ft, currently has the lowest among the eight markets. Hyderabad, MMR and Bengaluru have recorded rental increases of 30% or more since 2021, while Pune, Chennai and Ahmedabad have seen comparatively moderate appreciation of 17%, 19% and 20%, respectively.
Source: Anarock Research & Advisory
Vacancy Variations
The national vacancy rate stood at 7.9% as of 9M 2026, indicating that demand growth has been accompanied by varying levels of supply availability across markets.
The divergence in vacancy levels is notable. Pune recorded the lowest vacancy at 6.8%, followed by Chennai and Kolkata at 7.1% each, NCR at 7.3% and MMR at 7.6%. In contrast, Bengaluru reported the highest vacancy at 11.5%, followed by Ahmedabad at 11% and Hyderabad at 9.2%.
Interestingly, Bengaluru’s relatively high vacancy has almost counter-intuitively coexisted with a 30% increase in rents since 2021. Pune, despite having the tightest market, has recorded the slowest rental growth.
“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.
Source: Anarock Research & Advisory
Sectoral demand reflects distinct city-level specialisations
At the national level, third-party logistics (3PL) accounted for 26% of warehousing demand, followed by manufacturing at 22% and the automotive sector at 10%. Together, 3PL and manufacturing contributed nearly 50% of total demand, reflecting the importance of logistics networks and industrial activity in shaping the sector.
However, individual cities demonstrate distinct demand profiles.
MMR remains strongly logistics-oriented, with 3PL accounting for 40% of its warehousing demand.
Pune, on the other hand, is driven by manufacturing and automotive activity, which contribute 32% and 22%, respectively. The city accounted for 37% of all automotive-sector warehousing absorption across the top 8 cities between 2021 and Q3 2026.
Chennai’s industrial ecosystem is reflected in electronics accounting for 14% of its warehousing demand - the highest share in this segment among the eight cities.
Hyderabad is more manufacturing-led, with the sector contributing 31% of demand, while 3PL accounts for just 13% - the lowest share in this segment among the analysed markets.
Kolkata is also a logistics-oriented market, with 3PL contributing 36% of its demand.
NCR has a more diversified demand profile led by 3PL at 26%, manufacturing at 17% and retail at 13%.
Ahmedabad’s demand comes from 3PL, manufacturing and automotive occupiers, which contribute 28%, 22% and 21%, respectively.
City | Share of National Absorption | Top 3 Sectors (% of City Demand) | Avg. Rent Q3 2026 (₹/sft/month) | Rent Change Since 2021 | Vacancy Q3 2026 |
|---|
NCR | 21.80% | 3PL 26%, Manufacturing 17%, Retail 13% | 33.0 | 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% | 19.0 | 20% | 11.00% |
Pan India | 100% | 3PL 26%, Manufacturing 22%, Auto 10% | 28.1 | 27% | 7.90% |
Source: Anarock Research & Advisory
Growth Outlook
These trends indicate that while India’s warehousing and industrial real estate market is expanding, the benefits are not distributed evenly across cities. While NCR has emerged as the standout market for rental appreciation, Pune combines a substantial share of national absorption with the lowest vacancy. MMR continues to command a significant rental premium, whereas Bengaluru’s higher vacancy points to a more available pool of space despite considerable rental growth.
“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.”
In Indian warehousing’s next expansionary phase, the strength of occupier demand, composition of industry, and the availability of space will matter as much as the headline growth numbers.
