Leasing of warehousing space to rebound strongly in the post-corona world
According to reports, the demand-supply of industrial and warehousing space is expected to soften as compared to previous estimates in the near to medium term due to coronavirus pandemic.
The change is mainly attributed to the fact that coronavirus crisis has given rise to the increase in the e-commerce activity. Most of the world is in in some kind of lockdown and this has driven consumers to purchase online more. Industrial and warehousing is the most resilient segment in India, which is likely to emerge quickest and strongest post-COVID-19 due to expected growth in e-commerce as well as possible shift of manufacturing activities from China to India.
Higher supply contraction could lead to decrease in vacancies and optimum pricing, it added. In its report ‘India Front & Center – Production & Supply Chain’, Savills India has revised its estimates downwards for both absorption and new supply of warehousing and logistics space for 2020.The projection for warehousing and logistics leasing has been revised to 30 million sq ft from 40 million sq ft earlier. Fresh supply is now estimated at 12 million sq ft this year from 42 million sq ft projected earlier across top eight cities — Ahmedabad, Bengaluru, Chennai, Delhi, Hyderabad, Kolkata, Mumbai and Pune.
Embassy Industrial Parks has facilities in Maharashtra, Tamil Nadu, Telangana and Delhi-NCR. On industrial space, Virwani, who is also COO of Embassy Group, said: “India has not been able to compete with China and other Asian countries with manufacturing investments. Now is the opportunity to capitalise on the fear of setting up in China.”