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Industrial and warehousing demand in Mumbai and Pune declined sharply by 47% in Q1 2025, totaling 17 lakh square feet, according to Colliers India. Mumbai recorded 10 lakh square feet and Pune 7 lakh square feet, both significantly down from the previous year. Despite regional dips, overall demand across India's top eight cities grew by 15%, reaching 90 lakh square feet. Key drivers included engineering, e-commerce, 3PL, and automobile sectors. New supply rose to 94 lakh square feet, supported by institutional capital and robust infrastructure growth. The sector maintains its growth, fueled by favorable macroeconomic indicators and growing occupier confidence.
Industrial and warehousing demand in Mumbai and Pune witnessed a sharp decline in the first quarter of 2025, according to a report by Colliers India. Mumbai recorded a 47% drop in gross leasing activity, with volumes falling from 19 lakh square feet to 10 lakh square feet compared to the same period last year. Pune saw a similar decline, with demand falling 46% from 13 lakh to 7 lakh square feet. Advertisement
Despite these regional slowdowns, India's overall industrial and warehousing market showed considerable resilience. Across the top eight cities, leasing activity surged by 15%, rising from 78 lakh square feet in Q1 2024 to 90 lakh square feet in Q1 2025. This expansion reflects sustained occupier interest in core logistics hubs, driven by shifting supply chain strategies and continued infrastructure investments.
Engineering and e-commerce companies dominated demand during the quarter, each accounting for nearly 20 lakh square feet of leased space. Third-party logistics (3PL) players followed closely, contributing significantly to overall volumes. The automobile sector also maintained steady momentum, absorbing approximately 13 lakh square feet of Grade A warehousing facilities, underscoring the sector's push toward operational consolidation and geographic expansion.
Supply also rose year-on-year, keeping pace with growing demand. New project deliveries across major markets touched 94 lakh square feet, marking a 16% rise over the 81 lakh square feet introduced during the same period last year. This supply expansion was driven by robust institutional capital, improved last-mile connectivity, and increasing e-commerce penetration.
Colliers noted that demand is gradually diversifying across industries and that occupiers are increasingly opting for larger, modern spaces. The evolving preferences reflect a broader transformation in India's logistics ecosystem, with emphasis shifting toward operational efficiency, compliance, and sustainability. Backed by solid macroeconomic trends, strong investor backing, and steady occupier confidence, the industrial and warehousing sector is set to grow further in the coming months.
Top-tier cities continue to lead this shift, offering high-quality infrastructure and strategic locations to accommodate the evolving needs of modern supply chains. India's logistics landscape is undergoing structural change, and the upward trajectory seen in early 2025 signals a positive outlook for stakeholders across the warehousing and industrial property value chain.
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