India's logistics and industrial real estate sector achieved a remarkable milestone in the first half of 2026, recording a gross leasing volume of 36.2 million square feet (MSF). This figure represents the highest level of leasing activity ever documented for the first half of any year. The primary drivers of this surge in demand have been companies within the manufacturing, automobile, and third-party logistics (3PL) sectors. Specifically, 3PL operators accounted for 34% of total leasing activity, while engineering and manufacturing firms contributed 28%, highlighting a robust appetite for industrial space amidst evolving market dynamics.
The breakdown of leasing activity reveals that warehouse leasing constituted the largest segment, totaling 24.3 MSF, which is approximately 67% of total leasing. Concurrently, industrial leasing reached nearly 12 MSF during this period, indicating a healthy growth trajectory in both segments. The automobile sector also played a significant role, with leasing from automobile companies nearly doubling compared to the same period in 2025, contributing 4.8 MSF, or 13% of overall demand. This diversification across sectors underscores a broad-based recovery and growth in the logistics real estate market.
Geographically, the Delhi NCR region emerged as the leader in leasing activity, with 8.7 MSF, reflecting a year-on-year growth of 69%. Chennai and Pune followed, recording 6.1 MSF and 5.9 MSF, respectively, with growth rates of 39% and 32%. These figures illustrate the strong regional demand and the varying levels of growth across key urban centers. Abhishek Bhutani, Managing Director of Logistics & Industrial Services at Cushman & Wakefield, noted that despite ongoing geopolitical tensions and uncertainties in global trade, demand for logistics space has remained resilient. He emphasized that businesses are taking a cautious approach in their decision-making processes, yet their long-term expansion plans reflect confidence in India's manufacturing and consumer markets.
Looking ahead, the report anticipates sustained demand for logistics space in the latter half of 2026. Seasonal activities driven by e-commerce, retail, and the automobile sectors are expected to support leasing momentum, although external factors may continue to influence business strategies. As the market adapts to these challenges, the resilience displayed in the first half of the year suggests a promising outlook for the logistics real estate sector in India, reinforcing its critical role in the broader economic landscape.
