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The warehousing and logistics sector is expected to see annual absorption surpassing 45 million sq ft by the end of 2026, reflecting strong demand, according to a Vestian survey. After a phase of slowdown in 2025, India’s warehousing and logistics sector has begun 2026 on a stronger note. This is due to improved confidence among renters, steady domestic demand, and ongoing upgrades to infrastructure. Following a year of careful growth strategies and optimizing networks, renters are gradually moving back to expansion, seeking selective capacity increases in major logistics corridors, especially for high-demand properties.
In the first quarter of 2026, the top seven cities in India recorded an absorption of 11.4 million sq ft. This marks an 8 percent increase from the previous quarter and the fourth consecutive quarter of growth. Although absorption fell by 14 percent compared to last year, leasing activity remained strong, particularly from third-party logistics, engineering and manufacturing, and consumer goods sectors.
Mumbai and Pune accounted for 81% of the total leasing activity, highlighting the ongoing strength of established industrial and logistics hubs in western India. The continued recovery quarter after quarter suggests that the slowdown in 2025 was a strategic adjustment rather than a sign of weakened demand. Pune was the second-largest contributor with 4.46 million sq ft of absorption. This figure rose by 162 percent from the last quarter and by 42 percent year-on-year, signaling a strong rebound after lower activity in previous quarters.
Hyderabad saw an absorption of 0.69 million sq ft in Q1 2026, down 17 percent from the last quarter but up 50 percent from the same period last year. The NCR experienced an absorption of 0.73 million sq ft, which dropped sharply by 61 percent sequentially and 57 percent year-on-year, indicating limited leasing activity. Chennai recorded 0.59 million sq ft of absorption, a decrease of 50 percent from the previous quarter and 34 percent year-on-year, following a strong performance in earlier quarters. Bengaluru, despite a significant 566 percent increase from the last quarter, faced an 87 percent decline year-on-year, with absorption reaching 0.17 million sq ft in Q1 2026. Kolkata experienced a steep drop in leasing activity, with absorption falling to just 0.01 million sq ft.
Looking ahead, an increasing focus on supply chain resilience, a rising demand for modern Grade-A facilities, and continued growth in emerging Tier-I and Tier-II logistics hubs are expected to drive growth in 2026. Renters are likely to prioritize network efficiency, quicker delivery times, and technology-driven warehousing solutions, creating fresh demand in key corridors. The warehousing and logistics sector is projected to see annual absorption exceed 45 million sq ft by the end of 2026, indicating ongoing demand in the sector, according to the Vestian report.
For more such news and updates, follow CARGOCONNECT.
The warehousing and logistics sector is expected to see annual absorption surpassing 45 million sq ft by the end of 2026, reflecting strong demand, according to a Vestian survey. After a phase of slowdown in 2025, India’s warehousing and logistics sector has begun 2026 on a stronger note. This is due to improved confidence among renters, steady domestic demand, and ongoing upgrades to infrastructure. Following a year of careful growth strategies and optimizing networks, renters are gradually moving back to expansion, seeking selective capacity increases in major logistics corridors, especially for high-demand properties. In the first quarter of 2026, the top seven cities in India recorded an absorption of 11.4 million sq ft. This marks an 8 percent increase from the previous quarter and the fourth consecutive quarter of growth. Although absorption fell by 14 percent compared to last year, leasing activity remained strong, particularly from third-party logistics, engineering and manufacturing, and consumer goods sectors. Mumbai and Pune accounted for 81% of the total leasing activity, highlighting the ongoing strength of established industrial and logistics hubs in western India. The continued recovery quarter after quarter suggests that the slowdown in 2025 was a strategic adjustment rather than a sign of weakened demand. Pune was the second-largest contributor with 4.46 million sq ft of absorption. This figure rose by 162 percent from the last quarter and by 42 percent year-on-year, signaling a strong rebound after lower activity in previous quarters. Hyderabad saw an absorption of 0.69 million sq ft in Q1 2026, down 17 percent from the last quarter but up 50 percent from the same period last year. The NCR experienced an absorption of 0.73 million sq ft, which dropped sharply by 61 percent sequentially and 57 percent year-on-year, indicating limited leasing activity. Chennai recorded 0.59 million sq ft of absorption, a decrease of 50 percent from the previous quarter and 34 percent year-on-year, following a strong performance in earlier quarters. Bengaluru, despite a significant 566 percent increase from the last quarter, faced an 87 percent decline year-on-year, with absorption reaching 0.17 million sq ft in Q1 2026. Kolkata experienced a steep drop in leasing activity, with absorption falling to just 0.01 million sq ft. Looking ahead, an increasing focus on supply chain resilience, a rising demand for modern Grade-A facilities, and continued growth in emerging Tier-I and Tier-II logistics hubs are expected to drive growth in 2026. Renters are likely to prioritize network efficiency, quicker delivery times, and technology-driven warehousing solutions, creating fresh demand in key corridors. The warehousing and logistics sector is projected to see annual absorption exceed 45 million sq ft by the end of 2026, indicating ongoing demand in the sector, according to the Vestian report. For more such news and updates, follow CARGOCONNECT.
Welpsun One, a well-known warehousing real estate platform, announced that it signed a LoI with Balmer Lawrie and Co to sublease warehousing space in the financial capital of India, Mumbai. As per the Letter of Intent, Welpsun One will sublease around 65000 sq ft of Grade A+ warehousing space at WTC Nhava Sheva within the Jawaharlal Nehru Port Authority (JNPA) special economic zone to the company for a period of five years. With this move, Balmer Lawrie and Co became the first central public sector undertaking (PSU) to collaborate with Welspun One across its diversified portfolio. The partnership will also strengthen the company's rapid expansion into special economic zone (SEZ) warehousing and port-linked logistics operations, riding on its operating strengths in CFS (container freight station) operations, freight forwarding, and international trade facilitation. It is learnt that the facility is likely to be operational by the start of 2027. Currently, Balmer Lawrie already operates a container freight station at Jawaharlal Nehru Port Authority (JNPA) located in Navi Mumbai. The WTC Nhava Sheva facility, widely known to provide customs duty deferment and a swift clearance, will widen that footprint further into SEZ warehousing and value-added logistics services. Neeraj Balani, Chief Customer Officer, Welspun One, stated, “WTC Nhava Sheva has been designed for partners who require high-quality infrastructure, regulatory efficiency and direct proximity to India's most crucial port-led trade gateway, and we truly believe this will set the tone for many more institutional engagements.” WTC Nhava Sheva is Welspun One’s main project inside the JNPA SEZ and spans an area of 55 acres and offers about 4.45 million square feet of development space, with an investment of Rs 2,700 crore. Welspun One believes that the project would bring together warehousing, industrial, and EXIM-linked operations all in one place, under one roof, creating an integrated hub for businesses. For more such news and updates, visit CARGOCONNECT.
In a major step toward improving India’s medical device supply chain, Celcius Logistics has partnered with Ottobock India to launch a dedicated prosthetics and assistive-device warehouse facility in Thane, Maharashtra. The newly launched facility, located at Wagle Estate, spans approximately 3,000 sq ft and has been developed to support the storage and nationwide distribution of advanced prosthetic limbs, orthotic devices and other specialized healthcare products. The warehouse features 110 slotted racks, more than 700 bin locations, and a temperature- controlled section for storing sensitive medical materials. Under a five- year agreement, Celcius Logistics, an Indian healthcare and cold-chain logistics company will manage the end-to-end warehouse operations and transportation for Ottobock India, the Indian arm of Germany-based prosthetics manufacturer Ottobock. Both firms have already indicated plans to expand the facility’s operational capacity by nearly 25 percent within the next year as demand increases. Commenting on the partnership, Swarup Bose, Founder and CEO, Celcius Logistics, said, “This partnership reflects how healthcare supply chains in India are evolving towards greater precision, reliability, and accountability. At Celcius, we are focused on building infrastructure that can consistently support the movement of high-value, sensitive medical products at scale. By combining our technology-led logistics capabilities with Ottobock’s global expertise, we are enabling a more robust and responsive distribution ecosystem.” The launch of the Thane facility is therefore being seen by industry experts not only as a warehousing expansion, but also as a broader move toward building a specialized healthcare logistics in India. Follow CARGOCONNECT for more such updates.
