From Click To Quick: How Smaller Cities Are Powering India's Warehousing Surge

India's warehousing landscape is no longer just about the big metros — Tier II and III cities are now emerging as key players, fuelled by the rapid rise of e-commerce and the growing 'click-and-buy' culture, according to JLL. 

With online shopping becoming second nature for consumers, companies are racing to set up fulfilment centres closer to buyers, reshaping the country's logistics sector, the report found. 

India's total warehousing stock across the top 20 cities has reached a staggering 533 million sq. ft. in 2024, with 12 emerging Tier II-III cities contributing around 100 million sq. ft. — a solid 18.7% of the total. This marks a significant shift in warehousing demand, moving beyond traditional hubs like Mumbai, National Capital Region and Bengaluru.

According to JLL, the need for faster deliveries, lower logistics costs , and better last-mile connectivity. Companies are adopting a hub-and-spoke model, where smaller warehouses in Tier II-III cities help ensure quicker dispatches to customers. 

With warehousing absorption across 20 key markets hitting an all-time high of 60 million sq. ft. this year, it's clear that demand is soaring.

Certain cities are emerging as key warehousing hubs based on their strong consumption base. In eastern India, Bhubaneswar, Guwahati and Patna are leading the charge. In the north, Chandigarh, Jaipur, Lucknow and Ludhiana are witnessing high warehousing demand. Southern cities like Coimbatore and Kochi, along with western hubs such as Goa, Nagpur and Nashik, are also seeing increased interest from logistics players looking to expand operations.

Notably, Grade A warehouses — which offer modern facilities and higher operational efficiency — now account for 30% of the total inventory in these emerging cities. This signals increasing investor interest and a maturing logistics sector beyond just metro areas, according to the report. 

In terms of consumption base, in the east, Bhubaneswar, Guwahati and Patna lead the pack. In the north, Chandigarh, Jaipur, Lucknow and Ludhiana have the highest consumption base for warehouses. In the south Coimbatore and Kochi and in the west, Goa, Nagpur and Nashik. 

“At JLL, we anticipate this momentum continuing, fuelled by critical infrastructure initiatives that are linking these emerging cities with major consumption hubs," said Yogesh Shevade, head of logistics and industrial, India at JLL.