Category Archives: Warehousing

Warburg Pincus-backed logistics real estate firm ESR India has signed an agreement with Maharashtra government to invest Rs4,310 crore to set up 11 industrial and logistics parks around Mumbai and Pune. This affiliation with the Maharashtra government is aimed at encouraging industrial development in the state with streamlined land acquisition and administrative processes. The policy and regulatory reforms unveiled in recent times has accentuated the entry of international institutional players and has set new benchmarks for industrial developments in the country. Abhijit Malkani and Jai Mirpuri, Country Heads, ESR India, says, “The Government of Maharashtra and the MIDC (Maharashtra Industrial Development Corporation) have been very supportive of our efforts to develop world-class industrial and logistics infrastructure in the state, and these MoUs will fast-track investment into these projects, accelerate their development, and help attract more multinational and national companies to Maharashtra.” These parks, once fully operational, have the potential to create over 35,000 jobs in the state.

IndoSpace has been awarded Platinum certification by Indian Green Building Council (IGBC) for its logistics parks at Luhari I and II near NCR. IGBC rating systems recognizes achievement in green design, construction & operations and Platinum rating benchmarks applicants with international standards. IndoSpace Logistics Park Luhari I is the first logistics park in India to receive Platinum certification under the IGBC logistics parks and warehousing rating system. Founded in 2001 by CII, IGBC is the first Green building certification body in India. It is part of the World Green Building Council since 2004 as a ‘Founding Member’. The World Green Building Council is a global network of over 70 Countries. Rajesh Jaggi, Vice Chairman – Real Estate, Everstone Group, says, “We are delighted to receive these coveted certifications from IGBC which testify our conscious and responsible efforts towards creating sustainable facilities at our parks. As an industry leader, we have pioneered ‘green design’ and are committed towards protecting the ecosystem we operate in by employing better building design and highly efficient resource use.”

International Finance Corporation (IFC) is planning to invest around $75 million (Rs 550 crore) in Indospace Logistics Parks III LP. The funding will provide Indospace long-term finance in these times of the Covid-19 pandemic to continue investing and developing select projects envisaged under the fund over the next two years. IFC anticipates that its commitment will provide a significant positive step forward to the Indian warehousing and industrial property market, which is in its evolutionary phase and now going through a severe slowdown due to Covid-19. Indospace Logistics Parks III LP is a $580 million 2018 vintage fund for developing logistics and industrial parks across India. The fund invests in warehousing and industrial property assets through various special purpose vehicles.

Nitin Gadkari, Union Minister for Road Transport and Highways, Government of India has virtually laid the foundation stone for country’s first-ever multi-modal logistic park in Assam. The park will be constructed at a cost of Rs. 700 crore at Bongaigaon district. “The government is planning 35 new multimodal parks across the country. The Rs 693.97 crore park will provide direct connectivity to air, road, rail and waterways to the people. It will be developed under the ambitious Bharatmala Pariyojana of the Government of India,” states Gadkari in his address. The multi-modal logistic park will provide direct connectivity to air, rail, road, and waterways to the citizens of Assam and other parts of the North East. The fund for the logistic park will be spent on three components- railway and road connectivity as well as infrastructure and building work. An MoU will also be signed to implement the project successfully. The event was presided over by the Chief Minister Sarbananda Sonowal, and was attended by and Union MoS Jitendra Singh, Gen (Retd) Dr V K Singh and Rameshwar Teli, Ministers from the State, Members of Parliaments, MLAs and senior officers from the Centre and the State.

In order to create an enabling environment for its growth, the West Bengal government is providing benefits of an industry to the warehousing sector. Speaking at a webinar organised by ICC, Industry and Commerce Department Secretary Vandana Yadav said, “West Bengal is one of the leading states in the country to recognise the importance of logistics and warehousing sectors. Though the warehousing sector has not been given an industry status yet in the state, it is getting all related benefits. West Bengal has a unique locational advantage which cannot be taken away in terms of connectivity. The government does not interfere and has not put the warehousing and logistics sectors under any regulation.” UP has already accorded industry status to the warehousing sector. Yadav, also Managing Director, West Bengal Industrial Development Corporation, said, “The other big driver behind the growth of the warehousing sector is the improvement in infrastructure catering to logistics in the state. Logistics cost is an important aspect of determining the viability of any business. Benefits of volume and efficiency should also accrue to small players and not only the big ones.” The small players need to be connected to the e- commerce platforms for which good logistics infrastructure is required, she said. Another official of WBIDC said it is expected that the space utilisation in warehouses to go up in West Bengal. He said the state is targeting investments of Rs 12,000 crore in the logistics and warehousing segments, adding that the government has identified 500 acres of land for logistics development in the state.

Assam is all set to have country’s first international multi-modal hub, informs Chandra Mohan Patowary, Assam Industry and Commerce Minister. The Asian Development Bank (ADB) has agreed to fund the project at an estimated cost of around Rs 600 crore. “The Government of Assam is planning to develop Jogighopa, a small township near Brahmaputra river, as a logistics hub or trans-shipment point for cargo moving from Assam, Arunachal Pradesh, Nagaland to Bangladesh,” the minister informs. In addition, the Munshiganj River Terminal in Bangladesh will be used as a customs station to handle third-party export and import cargo via Kolkata Port. “To bring about a significant reduction in logistics cost and faster delivery of Bangladesh export cargo, the Indian side has raised the point regarding permitting a third country export-import trade under the coastal shipping agreement and protocol on inland water transit and trade (PIWTT) by allowing trans-shipment through ports on the east coast of India. The Bangladesh government agreed to hold stakeholder consultations and revert on the matter,” Patowary said. “Increasing connectivity through air, water, rail, road offer a mutually beneficial opportunity for enhancing economic cooperation between Bangladesh and the Northeastern states of India and beyond. Standard operating procedures for the use of Chattagram and Mongla ports for movement of goods to and from India, particularly to and from the Northeast of India have recently been concluded and it is expected that it would create a win-win situation for both economies,” he adds.

Highlighting the need for a robust cold chain infrastructure to strengthen the supply and storage of perishables to suffice India’s population, Manoj Pant, Regional Business Manager West, Snowman Logistics, notes “India is home to 535 agri-tech startups that use technology to bolster agricultural productivity. Food security in India has been immensely impacted by the pandemic in four main aspects – availability, accessibility, stability, and utilisation of food. Disruption in supply chains and a decline in demand have caused a loss of production and income to the farmers and traders. Closure of mandis and QSRs due to the lockdown led to a surplus accumulation of perishables. Since post-harvest losses are highest in the fruit and vegetable sector, agri-tech startups can bridge the gap with demand-driven cold chains, warehouse monitoring solutions, and market linkages that can significantly boost farmer income. With innovations in technology like storage monitoring based on the Internet of Things (IoT), image sensing for quality grading and digitisation of mandis will prevent the wastage of perishables.

According to the findings by CBRE the cold storage segment in India is expected to witness significant growth over the next few years on the back of a strong consumer and industrial base. Following the COVID-19 outbreak, the demand for cold storage is also being further fueled by a wider omni-channel distribution of F&G across tier I and tier II cities in the country. Further, the cold chain network would also play a vital role in reducing the loss of the produce and improving cold storage efficiencies. States including Uttar Pradesh, West Bengal, Gujarat, Punjab Andhra Pradesh, Bihar, Madhya Pradesh, Maharashtra, Haryana and Karnataka accounted for 91 per cent the total CS capacity in India in 2019. The overall cold storage real estate stock in the country is estimated to reach 1,400 – 1,500 million sq. ft. by 2023. Anshuman Magazine, Chairman, India & South East Asia, Middle East & Africa, CBRE said, “Cold storage facilities play an integral role in improving the shelf life of products and are an important enabler for several industries working across fresh food production and delivery; along with healthcare and other products such as flowers and chemicals. Considering the potential of the CS segment in the country, we expect that consumer/industry-led factors in India would continue to attract the interest of leading players in the coming years.”

According to a joint report by Binswanger Commercial Real Estate Services and ANAROCK Group focusing on ‘Indian Industrial & Logistics – Gearing Up a Global Manufacturing Hub’, high-intensity focus on making India a global manufacturing hub has caused warehousing clusters to expand rapidly beyond the top cities and into tier 2 and 3 cities. The report says that demand for small and multi-location warehouses is expected to rise significantly. Most of these emerging clusters are aligned with the industrial and freight corridors being developed in the country. The emerging tier 2 and 3 warehousing clusters include Ludhiana, Ambala, Lucknow, Siliguri, Guwahati, Bhubaneshwar, Vishakhapatnam, Vijaywada, Coimbatore, Kochi, Nagpur, Indore, Jaipur and Dholera. Shobhit Agarwal, MD & CEO, ANAROCK Capital says, “The rising demand for Grade-A warehousing properties across the country is a key trend. Our data indicates that there is more than 110 mn sq. ft. of Grade-A warehousing stock available across the country – most of it in the top 8 cities. 3PL (third-party logistics) and e-commerce are the largest occupiers of warehousing space. There is a massive opportunity for Grade-A warehousing development in the smaller cities amidst rising demand.” The report highlights that nearly US$ 7 billion worth platforms have been created for the warehousing sector since 2015. Over US$ 2 billion in PE investments have been infused in the industrial and logistics sector between 2017 and Q1 2020. Investors are upbeat on this sector and are working closely with developers to identify warehousing investment opportunities.

Spoton Logistics has expanded its logistics network by scaling up logistics hubs in Nagpur, Bengaluru, and Chennai respectively. The hubs offer comprehensive facilities to expand the horizon of deliveries during the festive season and support future growth in the regions. With its comprehensive delivery network, Spoton Logistics will continue to enable timely deliveries for eCommerce and retail giants in India. Currently enabling the delivery of 17,500 consignment notes (around 1,40,000 pieces) each day, the company is expecting a significant surge this festive season with Retail, eCommerce, and FMCG sectors driving this spike. “2020 has been an uphill battle for mankind. Months into the pandemic, businesses and consumers have found their way through to the new normal. With an increased adoption of e-commerce in the country, companies are betting big on online sales this festive season. The just-in-time expansion will help us significantly increase scalability for our customers while our web portal for them would ensure paperless and quick transactions. Moreover, Spoton Logistics is uniquely positioned as one of the most agile, innovative, and forward-thinking companies that can cater to the logistics needs of businesses in the current challenging business environment,” says, Abhik Mitra, MD & CEO, Spoton Logistics. “We ended the month of June and July with a recovery of greater than 90 per cent of pre-lockdown figures, and have surpassed our pre-COVID revenues during September. With the onset of the festive season, we are poised to further build on this momentum and have designed an effective roadmap for the same,” he adds.