E -commerce has turned out to be a huge driver of warehousing and logistics in India, especially through the pandemic according to Knight Frank. In the last year alone, the sector’s share in transactions grew from 23 per cent (FY2020) to 31 per cent (FY2021). “E-commerce companies became our major occupiers during the pandemic, with active expansion in Tier-I cities and select Tier-II and Tier-III markets,” says Abhijit Malkani, CEO, ESR India. “The e-commerce industry has seen exponential growth during the pandemic, and there is still room for substantial growth.” “The pandemic particularly catalysed e-commerce and generated warehousing requirements in Tier-II and Tier-III cities,” adds Architect Sneha Gurjar, Director, CEM Engineers. The e-commerce industry is the fastest-growing segment in the logistics sector, agrees Rajesh Jaggi, Vice Chairman, Real Estate, The Everstone Group. “E-commerce and thirdparty logistics providers are driving businesses to ramp up supply and storage to deliver products to customers quickly.” Knight Frank estimates that the share of the e-commerce sector, 3PL and other sector companies will grow from 78 per cent of the total transacted space to 86 per cent of the total transacted space in the next five years. Anshuman Magazine, Chairman & CEO - India, South-East Asia, Middle East & Africa, CBRE, expects the logistics sector to reach $330 billion by 2025 due to the rapid growth of the e-commerce sector and the growing retail sales market. “To fulfil the requirements of e-commerce and 3PL companies, and their shift from traditional to digital, the demand for omnichannel, multicategory large-scale warehouse has increased,” says Jaggi. “We have witnessed an increase in demand for in-city warehouses across the country owing to the expectations of faster, last-mile deliveries. The increasing volume and complexity of business operations are also driving the demand for built-to-suit facilities that are tailor-made to suit the company’s specific needs.” Apart from e-commerce, other sectors too have played a key role in intensifying the demand for logistics and warehousing “Logistics is also being driven by sectors such as cold storage, FMCG, pharmaceutical, retail and healthcare,” says Jaggi. “Government incentives in warehousing have also helped place the industry on a high-growth trajectory.” The slowdown during the pandemic caused demand to pent-up, as a result of which we are seeing accelerated expansion from retail, says Malkani. “Leading international manufacturing companies are actively looking at India’s potential post the pandemic, and there has been a surge amongst international occupiers looking at setting up their operations in India.”