India's warehousing industry appears to be rocking, going by a new report from real estate services firm JLL. Here is a summary. In India, about Rs 43,000 crore is expected to be invested in creating storage facilities, including warehousing and agri warehousing, cold chains and container storage, over the next three years. The biggest piece of this growth story is warehousing where Rs 35,000 crore could be pumped in. The investment will double the warehousing supply to 247 million sq. ft by 2020. This, in turn, can create around 1,30,000 jobs.
The report also estimates that "the prime beneficiaries of the new wave of growth in warehousing will be the peripheral locations of Tier I and Tier II cities". The top favoured locations include Surat, Kanpur, Lucknow and Ranchi. What is driving the market? The GST and the e-commerce sector. While the demand for faster deliveries is making online retailers build more warehouses closer to their customers, many other companies are probably investing in larger warehouses. Bigger warehouses bring economies of scale; they are also easier to automate.