April 14, 2023
Mini-metros’ warehousing revolution
Indian real estate and infra are witnessing a shift in demand from residential to commercial properties. As a result, mini-metros are emerging as the new growth engines for warehousing industry.
“E-commerce increased demand for warehouses in mini-metros given strategic location, lower land prices, road & rail accessibility,” writes Manikandan Ramachandran of TVS Industrial & Logistics Parks.
“As land prices in India have soared by 60% in major cities like Delhi NCR, Mumbai, and Bengaluru, mini-metros have become the new warehousing hubs for businesses.”
For instance, Odisha has become a preferred destination for warehousing due to its central location and excellent connectivity to major cities in North India.
Similarly, Hosur and Madurai are becoming a hub for e-commerce companies looking to cater to customers in South India.
Govt's focus on infra, connectivity has made mini-metros like Bhubaneshwar, Ambala, Lucknow, Siliguri, Guwahati, Vishakhapatnam, Coimbatore, Kochi, Pune, more accessible.
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“Lower cost of living, better work-life balance, affordable housing have led to migration of talent from metros to mini-metros, driving demand for commercial properties, including warehouses.”
While mini-metros offer several advantages for warehousing companies, there are also some challenges that need to be addressed.
Lack of skilled labour
One of the primary challenges is the lack of skilled labor in these cities, which makes it difficult for companies to recruit and retain talent.
There is still a lot to be done in terms of infrastructure development, connectivity, and logistics in some mini-metros.
The lack of clear land titles and legal disputes over land ownership might further complicate the process of acquiring land for warehousing purposes.
“To overcome the challenges of skilled labor and infra, companies can invest in training programs to upskill the local workforce and work closely with the govt to improve connectivity.”
“As the economy grows, real estate prices will rise. Warehousing companies should make the most of the present circumstances to increase their foothold in the hinterlands of India.”
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