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Tuesday, July 27, 2021

Pune sees record dip in warehousing due to Covid-induced economic slowdown

In their latest report on warehouse transactions for the year 2020-21, property consultant Knight Frank has singled out Pune and Ahmedabad for the least such transactions in the country.

By: Express News Service | Pune |
Updated: July 7, 2021 8:58:32 am
The report, which was released in Pune on Tuesday, said the district had seen 2.8 million square feet of warehouse transactions in the last fiscal. (Representational)

After a year-long high, warehouse transactions in Pune saw a record dip of 42 per cent in the financial year 2020-21.

In their latest report on warehouse transactions for the year 2020-21, property consultant Knight Frank has singled out Pune and Ahmedabad for the least such transactions in the country.

The report, which was released in Pune on Tuesday, said the district had seen 2.8 million square feet of warehouse transactions in the last fiscal. During the previous financial year (2019-20), Pune had seen 4.8 million square feet of such transactions.

Among the major cities barring Chennai, all have recorded a steep dip in such transactions. Chennai has stood out by recording a 4 per cent growth in such transactions.

In Pune, the largest drivers for the sector were the automobile, electronics, pharmaceuticals and other segments of the manufacturing industry. E-commerce, once the main driver behind warehousing growth, had contributed just two per cent of the transactions. Manufacturing had accounted for 70 per cent of the transactions as compared to 50 per cent in the previous year. The Chakan-Talegaon cluster has emerged as the top destination for such transactions accounting for 74 per cent of the transactions. “Due to the high land prices in Chakan, Talegaon has emerged as an attractive location for both warehousing as well industrial leasing. The Chakan-Talegaon belt has attracted several major occupiers such as IKEA, Amazon, Stellar Value Chain Solutions, etc. Ranjangaon warehousing cluster accounted for 19 per cent of the total transaction volume during the period,” the report read.

Paramvir Singh Paul, branch director, Pune, Knight Frank India, said, “FY 2021 was a challenging year for the warehousing sector in Pune as the extended lockdown during the first wave of the pandemic had a bearing on demand. On the positive side, we are witnessing stronger demand from the industrial segments which made up 66 per cent of transactions. The industrial demand in Pune, which was earlier concentrated only from the automobile segments, is now coming from diverse sectors. As Pune offers established ecosystem of a mature manufacturing hub almost unparalleled anywhere else in India, we believe that the city is likely to benefit from the ‘China+1’ strategy being adopted by several manufacturers globally.”

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