NCR Leads Warehousing Demand as Rents Rise 44% Since 2023

The National Capital Region (NCR) accounted for 21.8% of cumulative warehousing absorption across India’s eight major cities between 2021 and September 2026, while monthly warehouse rents in the region climbed 44% between 2023 and the third quarter of 2026 to ₹33 per sq ft, according to an ANAROCK Research and Advisory report.

India’s warehousing and industrial real estate market recorded net absorption of 49.5 million sq ft during the first nine months of 2026, registering a year-on-year increase of 16.2% from the corresponding period last year.

Cumulative net absorption across the eight cities reached 266.5 million sq ft during the period under review.

NCR, Mumbai and Pune lead warehousing demand

NCR retained its position as the largest warehousing market, followed by the Mumbai Metropolitan Region (MMR) and Pune, which accounted for 18.5% and 17.4% of cumulative absorption, respectively.

Pune overtook Bengaluru, which contributed 15.1% of the total demand. Together, NCR, MMR and Pune accounted for nearly 58% of cumulative warehousing absorption across the eight major markets.

Peush Jain, managing director, commercial leasing and advisory, ANAROCK Group, said the growth in warehousing demand was encouraging, but remained concentrated in a few markets.

“NCR, MMR and Pune together accounted for nearly 58% of cumulative absorption across the top eight cities,” Jain said.

He added that rental appreciation and vacancy levels varied considerably across cities.

NCR records sharp rental appreciation

The average monthly warehousing rent across the eight major cities stood at ₹28.1 per sq ft in the third quarter of 2026, marking a 27% increase since 2021.

In NCR, rents increased from ₹22.2 per sq ft in 2021 to ₹33 per sq ft in the third quarter of 2026, representing a 49% rise over five years. The report highlighted that rental growth in the region had accelerated in recent years.

MMR continued to command the highest average monthly warehousing rent among the eight markets at ₹43.9 per sq ft. Ahmedabad recorded the lowest average rent at ₹19 per sq ft, while Pune’s average monthly rent stood at ₹27.4 per sq ft.

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Warehousing vacancy levels vary across markets

The national warehousing vacancy rate stood at 7.9% as of September 2026, while NCR recorded a vacancy rate of 7.3%.

Pune reported the lowest vacancy rate at 6.8%, followed by Chennai and Kolkata at 7.1% each. Bengaluru recorded the highest vacancy rate among the eight markets at 11.5%.

The report also highlighted differences in occupier demand across sectors.

Third-party logistics (3PL) accounted for 26% of national warehousing demand, followed by manufacturing at 22% and the automotive sector at 10%.

In NCR, demand was relatively diversified, with 3PL contributing 26%, manufacturing 17% and retail 13%.

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Market fundamentals to shape rental performance

Jain said the availability and quality of warehousing stock, location, occupier requirements and the nature of industrial activity would determine rental performance across markets.

He added that developers and investors would need to assess individual market fundamentals rather than rely solely on national demand growth.

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