The industrial and logistics real estate market in India has shattered previous records, achieving its highest-ever annual leasing activity in the 2025 calendar year. According to the latest data from real estate consultant Savills India, demand for these spaces surged dramatically, highlighting the sector's robust post-pandemic expansion.
Record-Breaking Numbers and Sector-Wise Demand
The total leasing volume for industrial and logistics spaces across 24 major Indian cities reached an unprecedented 76.5 million square feet. This marks a substantial increase of nearly 19% compared to the 64.5 million square feet leased in the 2024 calendar year.
Drilling down into the data reveals which sectors are driving this phenomenal growth. The manufacturing sector emerged as the largest contributor, accounting for 29% of the total leased space. It was closely followed by third-party logistics (3PL) firms, which took up 28%. E-commerce companies, continuing their need for extensive distribution networks, accounted for 12% of the leasing activity.
Tier-I Cities Lead, Delhi-NCR Shines
The growth was powered by strong performances across the country, with tier-I metropolitan areas showing particularly vigorous activity. Eight major cities—Ahmedabad, Bengaluru, Chennai, Hyderabad, Kolkata, Mumbai, Delhi-NCR, and Pune—collectively witnessed a 20% growth in leasing. Their combined absorption rose to 59.5 million square feet in 2025 from 49.7 million square feet the previous year.
Among these, the Delhi-National Capital Region (NCR) stood out as the best-performing market. Leasing in Delhi-NCR jumped to 13 million square feet this year, a significant rise from the 9.8 million square feet recorded in 2024.
Tier-II & III Cities Show Strong Momentum
The expansion story is not confined to the major metros. Tier-II and tier-III cities are also experiencing a significant uptick in demand, indicating a broadening of the industrial and logistics footprint across India. Leasing activities in these 16 cities grew by 14.5% to reach 17 million square feet in 2025, up from 14.8 million square feet in 2024.
The cities contributing to this growth in the tier-II and III segment include:
- Guwahati, Bhubaneshwar, Patna
- Hosur, Coimbatore, Rajpura
- Lucknow, Jaipur, Nagpur, Surat
- Indore, Kochi, Hubli, Vizag, Belgaum, Anantapur
Optimistic Outlook for the Future
Buoyed by the current momentum, Savills India has projected an even brighter future for the sector. The consultant expects that both the supply of new spaces and the absorption (leasing) are poised to cross the 80 million square feet mark in the coming year. This forecast underscores the sustained confidence in India's industrial and logistics real estate, driven by manufacturing push, evolving supply chains, and sustained consumption demand.
The record-breaking figures for 2025 solidify the sector's position as a critical pillar of India's economic infrastructure, witnessing growth that outpaces pre-pandemic levels and setting a new benchmark for the years to come.
