Bengaluru warehouse leasing jumps 78% to 3.1 MSF in H1 2026, fastest growth among major markets
New Delhi, 9 August
Bengaluru is expected to remain a key logistics and warehousing hub as strong occupier demand continues to support leasing activity, with warehouse rentals already rising 4-5 per cent annually and land prices increasing 9-10 per cent in H1 2026, according to Cushman & Wakefield.
The city recorded the fastest growth in warehouse leasing among India's top eight markets during the first half of 2026.
Warehouse leasing in Bengaluru surged 78 per cent year-on-year to 3.1 million square feet (MSF) in H1 2026, while leasing rose 64 per cent compared with H2 2025, according to Cushman & Wakefield's H1 2026 Logistics & Industrial MarketBeat report.
The city's overall logistics and industrial market also maintained strong momentum, with gross leasing reaching 4.4 MSF during the first half of the year, representing a 63 per cent increase over H2 2025.
The strong demand came despite the addition of nearly 2 MSF of new Grade A warehouse supply during the period. Vacancy levels consequently declined to 11 per cent from 13 per cent, indicating that occupier demand continued to absorb new capacity.
Bengaluru's western corridor remained the dominant warehousing destination, accounting for 52 per cent of total warehouse leasing during H1 2026. The activity was led by Nelamangala and Dabaspete. The eastern submarket accounted for another 46 per cent, driven by demand in Hoskote, while the northern and southern submarkets contributed the remaining share.
Third-party logistics (3PL) companies emerged as the largest occupier segment, accounting for 58 per cent of warehouse leasing. Manufacturing firms contributed 16 per cent, followed by e-commerce at 15 per cent and FMCG companies at 8 per cent.
The industrial segment also remained resilient, recording nearly 1.4 MSF of leasing during H1 2026. North Bengaluru accounted for 35 per cent of industrial demand, led by Doddaballapur and KIADB Hardware Park at Devanahalli, while the western submarket contributed 28 per cent.
Headline industrial rentals also increased 3-4 per cent annually during H1 2026, pointing to continued pricing momentum alongside sustained demand for logistics and industrial space.
— ANI
Reader Comments
Finally some positive infrastructure news! But with land prices up 9-10%, small businesses will struggle to set up warehouses. The government needs to ensure inclusive growth, not just for big players.
Impressive growth numbers! Bengaluru's western corridor really seems to be the sweet spot for logistics. As someone in the industry, I can see why 3PL companies are leading the demand. Great infrastructure development!
The 11% vacancy rate shows a healthy balance between supply and demand. But I'm concerned about the rising rentals - this could eventually push up consumer prices for goods stored in these warehouses. Food for thought! 🤔
Great to see Bengaluru leading the charge! The increase in Grade A warehouse supply is particularly encouraging - finally moving towards world-class logistics infrastructure. This will boost e-commerce delivery times across South India!
While this growth is impressive, I hope the authorities are planning for proper road connectivity and sustainable infrastructure around these warehouse clusters. We don't want more traffic congestion in and around Nelamangala and Hoskote. Good data though!
Strong numbers from Cushman & Wakefield. The shift towards Grade A warehouses and the rise of 3PL players shows Bengaluru is maturing as a logistics
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