Kolkata has emerged as the third-largest market in India for storage and logistics, achieving a 70% surge in space absorption. The city accomplished a rare feat among any asset class in real estate, outperforming the metropolis in all but the National Capital Region encompassing Delhi and Bangalore. The industry of warehouse in Kolkata is expected to grow immensely in the near future.
The world bank is utilising Kolkata’s enormous potential to become a significant transportation and logistics centre connected to the northeastern area and other nations. The World Bank previously signed a tripartite agreement to grant a soft credit of $105 million to build inland waterways in and around Greater Kolkata on the Hooghly River.
Whereas, the country director of the world bank wants to partner with the government to transform Kolkata into a transportation and logistics centre for the sub-regions that connect the northeast.
Greater Kolkata is expected to draw Rs 5,000 crore investments by 2022, meeting the demand from occupiers wishing to serve East and Northeast India. In 2018, the city and its suburbs occupied 3.4 million square feet of Grade A space, an increase of 70% from the 2 million square feet occupied in 2017. By 2022, Kolkata’s fresh absorption is expected to double.
The Howrah and Hooghly districts are covered by the Delhi Road, Old Delhi Road, and Bombay Road sectors, which are located 30 to 40 kilometres from the metropolis. In addition to being close to the city, in this case, Kolkata, these locations have good access to the North Indian states on one side and the Eastern and North-eastern states on the other. So naturally, developers and PE firms are interested in most of the regions around the motorways.
Some factors that have led developers and PE funds to consider the eastern region include the GST, better connectivity to neighbouring Eastern and North-eastern states, more extensive penetration and a more substantial “hub and spoke” model.
Naturally, land costs there have increased by 30%. Land prices have increased from Rs. 70 lakhs per acre to nearly one crore per acre. Additional development costs amount to $1,500 per square foot. Companies are spending extra money on construction in addition to the cost of the property. As a result, there will be a multiplier effect on investments.
In 2018, the Kolkata warehouse market saw an absorption of 0.4 million square metres (4.7 million square feet). In 2017, Kolkata experienced the most significant year-over-year (YoY) growth in total leasing among India’s top eight cities due to a rapid increase in demand for storage space.
Varuna group is the best logistics company in Kolkata. A network of Grade A warehouse facilities is maintained and managed by Varuna Group and is strategically positioned throughout India. The leaders in the sector depend on their warehouse services for their dependable, efficient, and consistent performance. Their skilled team uses the specialised Warehouse Management System (WMS) & Transport Management System (TMS), which offers real-time data intelligence, to manage inventory and provide quantifiable cost savings.
If you are looking for a warehouse in Kolkata, connect with Varuna, the best logistics company in Kolkata.