Knight Frank: Bengaluru Warehousing Demand Climbs to 6.6 Million Sq Ft.

Manufacturing sector emerged as the dominant sector in the city’s warehousing market 

Bengaluru, 12 March 2025: Knight Frank India, a leading international property consultancy, , cited that Bengaluru has witnessed transaction volume growth of 27% year-on-year (YoY) with a total area leasing of 6.6 million square feet (mn sq ft) in 2024 which when compared to 2023 was 5.2 mn sq ft. Bengaluru’s warehousing market thrives on strong infrastructure connectivity and solid economic fundamentals. With major highways like NH-75 and NH-48 ensuring smooth cross-border transportation, the city has emerged as a key hub for logistics and warehousing operations.

Source: Knight Frank Research

The city of Bengaluru has a development potential of 28.5mn sq ft to service any additional demand. This translates to around four times the annual transaction volumes in 2024.

Industry wise, other manufacturing (excluding FMCG and FMCD) emerged as the leading sector in Bengaluru’s warehousing market, accounting for 41% of total leasing activity, up from 32% in 2023. This trend underscores the increasing significance of industrial occupiers in the region. Meanwhile, retail and e-commerce sectors experienced notable growth, with their leasing share rising from 12% to 16% and 3% to 11%, respectively. The expansion of e-commerce reinforces Bengaluru’s position as a technology and consumption hub, driving higher demand for last-mile fulfilment centres. Additionally, the FMCG sector expanded its presence, growing from 3% in 2023 to 7% in 2024.

INDUSTRY-SPLIT OF TRANSACTION VOLUME

Source: Knight Frank Research

Notes:

• Warehousing transactions data includes light manufacturing/assembling.
• Other Manufacturing – These include all manufacturing sectors (automobile, electronics, pharmaceutical, etc.) except FMCG and FMCD.
• Miscellaneous – These include services such as telecom, real estate, document management, agricultural warehousing and publishing.

The Nelamangala-Dabaspete cluster has emerged as Bengaluru’s preferred warehousing hub, marking a significant shift in cluster-wise leasing. Major tenants such as Bosch, Shoppers Stop, and ABB have played a key role in driving this growth. In 2024, the region accounted for 52% of total leased space, a sharp increase from 21% in 2023, with the Nelamangala market contributing to over half of the transactions. This surge is largely attributed to the cluster’s strategic connectivity via National Highway 48, facilitating access to key consumption centers across southern and western India.

Source: Knight Frank Research 

Shishir Baijal, Chairman and Managing Director, Knight Frank India said, “Bengaluru’s warehousing market continues to expand, driven by rising leasing activity, manufacturing sector growth, and increasing demand from e-commerce and retail players. Strengthened by improved infrastructure, supportive policies, and sustained occupier interest, the market is set for long-term growth. As warehousing needs evolve, Bengaluru is expected to reinforce its position as a leading logistics hub in Southern India”.  

BENGALURU: LAND RATE AND RENTS

In 2024, the warehousing market of Bengaluru recorded the rental value at INR 22.5/sq/ft/per month, reflecting a YoY of 2%. The rental value in Grade A warehouse is the highest in the micro market of Bommasandra-Jigani in Attibele-Bommasandra cluster at INR 26 – 42 /sq ft/month, followed by the micro market of Devanahalli in the Devanahalli-Doddabalapur cluster where the rental value range between INR 28 – 40 /sq ft/month.

Source: Knight Frank Research