Delhi NCR warehousing stock set to surpass 120m sq ft this year

Grade A vacancies are expected to hover below 10% for the next four years.

Delhi-NCR’s industrial and warehousing market recorded its strongest year on record in 2025, with net absorption touching an all-time high of 9.8 million sq ft, according to a new report by JLL. The milestone performance reflects sustained occupier confidence, a structural shift toward higher-quality facilities and increasing institutional participation in the region.

As highlighted by JLL, more than 70% of the total demand in 2025 was concentrated in Grade A assets, underlining a decisive shift in occupier preference towards compliant, future-ready spaces with superior specifications. The consultancy attributes this trend to growing requirements from consumption-led sectors and evolving supply chain strategies that prioritise efficiency and scalability.

At the submarket level, Delhi–NH8 emerged as the clear frontrunner in demand. According to JLL, the corridor’s established physical ecosystem, bolstered by infrastructure initiatives such as the Western Dedicated Freight Corridor (WDFC) and the Delhi–Mumbai Industrial Corridor (DMIC), has significantly enhanced its attractiveness to occupiers. Third-party logistics (3PL) and e-commerce players accounted for over 50% of total demand, followed by FMCG, retail and auto ancillary companies.

On the supply front, the market added 9.3 million sq ft of new space in 2025, of which 5.1 million sq ft was Grade A, as per JLL. The Delhi–NH8 submarket also led in new completions, reflecting rising traction from institutional investors who are steadily expanding their footprint across NCR. The report notes that institutional capital is playing a pivotal role in elevating development standards and accelerating the delivery of premium warehousing assets.

Robust demand has significantly tightened vacancy levels. Overall vacancy declined by 240 basis points year-on-year, with demand outpacing supply during the year. Notably, Grade A vacancy saw a sharp compression of 590 basis points, falling from 14.4% in 2024 to 8.5% by the end of 2025, according to JLL. This steep reduction, the consultancy explains, has been driven by strong absorption of high-quality space by e-commerce, 3PL and other consumption-driven occupiers.

Rental values have also trended upward. JLL reports a 3.2% year-on-year increase in rents, supported by resilient Grade A demand, falling vacancy and growing institutional participation. Rising land costs have further reinforced the upward momentum. The consultancy expects rents to continue their ascent as investment activity intensifies and occupiers increasingly seek modern facilities with higher technical specifications.

Looking ahead, JLL projects that NCR’s total warehousing stock will exceed 120 million sq ft by 2026, primarily driven by Grade A developments backed by institutional capital. The Delhi–NH8 submarket is expected to maintain its leadership position in both supply and demand, sustaining overall market momentum.

Infrastructure upgrades are set to remain a key growth catalyst. Proposed freight corridors, including the DMIC, WDFC and the Eastern Dedicated Freight Corridor (EDFC), are strengthening connectivity between Delhi and western and eastern India, thereby enhancing the region’s logistics competitiveness. With continued expansion of e-commerce and 3PL operations, JLL anticipates that Grade A vacancy levels will remain below 10% over the next four years, reinforcing NCR’s position as one of India’s most dynamic industrial and warehousing hubs.