E-commerce growth creates robust demand for warehouses around Chennai

In Chennai, there is demand for warehousing spaces in locations such as Orakkadu near Ponneri, Sholavaram, Red Hills to Tiruvallur Road and Minjur. Apart from this, over the last two years developers have been expanding their footprint to second tier cities of Madurai, Coimbatore and Salem, according to details provided by Jones Lang LaSalle.

“3PL and E-Commerce have emerged as one of the fastest growing segments in  warehousing  space, contributing highest among all the other sectors,” said Jerry Kingsley, Head, Strategic Consulting and Valuation Advisory India & City Lead Capital Markets – Chennai, Jones Lang LaSalle.

Mr. Kingsley said that over the last few years, key global funds have been actively partnering with regional warehouse developers and operators to expand their portfolio and footprint. “Such investments are not restricted to tier 1 cities but also tier-2 and tier-3 cities, with these cities now emerging as major consumption and e-commerce hubs,” he said.

Real estate observers said Tamil Nadu government has been actively encouraging the development of warehousing and logistics sector. To attract investment, the government has taken several initiatives, including the construction of logistics parks, the establishment of a single-window clearance system, and is offering financial incentives.