Warehousing keeps holding smart money

Warehouses emerged as a key investment segment in the past 4-5 years

- Dipti Sharma & Mansi Verma

For investors in India's real estate market, it isn't just office properties and residential development that are vying for their money. The more timid warehousing space is chasing them, too.

Warehouses emerged as a key investment segment in the past 4-5 years, driven by strong demand from logistics, e-commerce, manufacturing and retail occupiers. However, investors are becoming increasingly selective now, prioritizing Grade A assets in top-tier cities and favoring tech-enabled and environmentally sustainable warehouses, according to industry participants.

Grade A warehouse stock across India's eight primary markets grew at a compound annual growth rate of 21% over the past five years, reaching 183 million sq. ft in 2023-24, credit rating agency Icra said in a July 2024 note.