India’s warehousing sector bounces back with 64% growth in Q3 CY2025

India’s warehousing and logistics sector has staged a strong comeback in the third quarter of calendar year 2025, registering a 64% increase in absorption compared to the previous quarter, according to real estate consultancy Vestian. The total absorption during the quarter stood at 9.2 million sq ft, marking a solid recovery after a subdued start to the year. However, the report noted that the activity was still 36% below the same quarter last year, when the sector had reached a record high.

Mumbai emerged as the frontrunner in this rebound, contributing nearly 47% of the total national absorption with 4.29 million sq ft of space leased. The city saw a massive 377% rise from the previous quarter and a 10% increase over the same period last year. Most of this activity was concentrated in the Bhiwandi and Panvel regions, which have become key warehousing hubs due to their connectivity and expanding industrial base.

The National Capital Region (NCR) followed as the second-largest contributor, with 1.28 million sq ft of absorption, an 83% jump from Q2 2025, though still 40% lower than last year’s figures. Chennai also delivered a strong performance, clocking 1.13 million sq ft, its highest leasing volume in seven quarters. The city’s absorption grew 151% quarter-on-quarter and 38% year-on-year, supported by robust manufacturing and retail activity.

Kolkata reported an exceptional surge, recording its highest-ever absorption at 1.26 million sq ft. This marked a staggering 950% increase from the previous quarter and 186% growth over the same period last year. Analysts said the city’s rise signals growing investor interest in eastern India’s logistics infrastructure.

Meanwhile, other cities displayed mixed trends. Hyderabad’s absorption grew 7% from the previous quarter but slipped 14% compared to a year ago. Pune continued its downward trajectory for the fourth consecutive quarter, falling 31% quarter-on-quarter and 87% year-on-year. Bengaluru recorded the lowest absorption among major markets, witnessing a sharp decline of 94% over the previous quarter and 90% over last year.

Commenting on the sector’s outlook, Shrinivas Rao, FRICS, CEO of Vestian, said the quarter showed “clear signs of revival,” driven by strong activity in Mumbai, Kolkata and NCR. He highlighted that growing interest from E-commerce and third-party logistics (3PL) players, along with a focus on network optimisation and better-quality assets, is reshaping India’s warehousing landscape. Rao added that this renewed momentum reflects business confidence and sets the stage for stronger performance in the coming months.