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The warehousing and logistics sector is anticipated to witness annual absorption exceeding 45 million sq ft by the end of 2026, reflecting sustained demand in the sector, says Vestian survey.
Following a phase of moderation in 2025, India’s warehousing and logistics sector has entered 2026 on a stronger footing, supported by improved occupier sentiment, resilient domestic demand, and continued infrastructure upgrades.
After a year marked by cautious expansion strategies and network optimisation, occupiers are now gradually returning to expansion, pursuing selective capacity additions across key logistics corridors, particularly in high-demand assets.
The top seven cities in India recorded an absorption of 11.4 million sq ft in Q1 2026, registering 8 per cent quarter-on-quarter increase and the fourth consecutive quarter of sequential growth. While absorption declined by 14 per cent year-on-year, leasing activity remained robust, led by 3PL, engineering & manufacturing, and consumer goods occupiers.
Mumbai and Pune together contributed 81% of the total leasing activity, underscoring the continued dominance of established western industrial and logistics hubs in driving demand. The sustained quarterly recovery indicates that the moderation witnessed in 2025 was a phase of strategic recalibration rather than a structural slowdown in demand.
Echoing this sentiment, Shrinivas Rao, CEO, Vestian said, “The warehousing and logistics sector has begun 2026 with renewed momentum, as occupiers resume expansion plans following a period of consolidation in 2025. Sequential growth in absorption reflects strong underlying market fundamentals, supported by rising manufacturing activity, infrastructure development, and resilient domestic consumption. While annual comparisons remain impacted by last year’s high base, the sector remains well positioned for sustained growth in the coming quarters.”
Mumbai recorded the highest absorption at 4.76 million sq ft in Q1 2026, accounting for 42% of the pan-India absorption.
Pune emerged as the second-largest contributor with 4.46 Million sq ft of absorption—surging by 162% quarter-on-quarter and 42% year-on-year, indicating a strong revival after subdued activity in the past quarters.
Hyderabad recorded an absorption of 0.69 million sq ft in Q1 2026, witnessing 17% decline over the previous quarter but a notable 50% increase compared to the same period last year.
NCR witnessed an absorption of 0.73 million sq ft, declining sharply by 61% sequentially and 57% year-on-year, reflecting muted leasing activity during the quarter.
Chennai registered 0.59 million sq ft of absorption, down 50% over the previous quarter and 34% annually, following strong momentum in earlier quarters.
Bengaluru, despite recording a sharp 566% quarterly increase, saw absorption decline by 87% annually, reaching 0.17 million sq ft in Q1 2026.
Kolkata witnessed a steep fall in leasing activity, with absorption dropping to a negligible 0.01 million sq ft.
Looking ahead, a growing emphasis on supply chain resilience, rising demand for modern Grade-A facilities, and continued expansion into emerging Tier-I and Tier-II logistics hubs are expected to drive the next phase of growth in 2026. Occupiers are likely to prioritise network efficiency, faster delivery capabilities, and technology-enabled warehousing solutions, creating fresh demand across strategic corridors. The warehousing and logistics sector is anticipated to witness annual absorption exceeding 45 million sq ft by the end of 2026, reflecting sustained demand in the sector, according to Vestian report.
My parents passed away recently and we are three brothers who inherited the family property in Mumbai and Pune. One of my brothers is not keen for a share in the property and how we do ensure that it is legally transferred to all the legal heirs. Rajiv Kumar Nigam, Sharjah
Your brothers will have to execute a release deed or a settlement deed in your favour. The legal document is of course subject to stamp duty and registration charges. You can also apply for a legal heir certificate and the tehsildar, after conducting an enquiry will issue a certificate mentioning the names of legal heirs who succeeded to the estate. With your brother’s release deed and legal heir certificate, you are in a legally sound position to either retain or sell the property at any stage.
I acquired an immovable property by way of gift from my relative in India. Can I dispose of the gifted property and repatriate sale proceeds to my foreign account? Prakash Rangarai, Dubai.
You can repatriate the immovable property received by way of gift from your relative in India. The sale proceeds of the immovable property should be credited to NRO account only. From the balance held in the NRO account, you may remit upto US$1 million, per financial year, subject to the satisfaction of the authorised dealer and payment of applicable taxes. You may be required to file tax return for property sale income and taxes paid on it.
