Prime Warehouse rents in NCR, Mumbai, Bangalore to increase in the coming months, according to Knight Frank
Recently, Knight Frank released its latest Asia Pacific Warehouse Review report. As per the report, an average rental growth of 3% to 5% by the end of 2020 for warehouses across the region is expected. Warehouses are in demand owing to the surge in e-commerce activity amid the ongoing coronavirus pandemic. Also, Mumbai, NCR and Bengaluru experienced growth in demand for storage space for essential items.
The report tracks the prime warehouse rental performance across 17 key cities in the Asia Pacific region. Despite spread of covid-19, cities registered an average rental change of -0.02% year on year – in H1 2020. The report cited that 5 of 17 cities prime warehouse rents to increase over the next 12 months, including those in National Capital Region (NCR), Mumbai, Bengaluru, Taipei, and Shanghai.
In H1 2020, 12 of 17 cities recorded stable or rising rents in prime warehouse and logistics markets. The warehouse sector across Mumbai, NCR, and Bengaluru, which accounts for around two-thirds of all the warehouse stock in India, recorded stable rental growth within the first six months of 2020.
According to the recent ‘India Warehousing Market Report – 2020’, a study on asset class performance across 22 Indian cities by Knight Frank India, the warehousing sector had seen a strong demand growth of 44% CAGR, with transactions increasing from 13.9 mnsq ft in FY 2017 to 41.3 mn sq-ft in FY 2020.