Q-Commerce Boom Fuels Grade-A Warehousing Demand, but Supply Lags, Says Welspun One CCO

The rapid expansion of quick commerce has materially accelerated demand for Grade-A warehousing, particularly in in-city and last-mile formats, says Neeraj Balani, Chief Customer Officer at warehousing company Welspun One. However, there is a “disconnect between where demand is emerging and the nature of existing supply,” he noted.

According to a Savills report, dark stores have expanded across eight Tier-I cities and more than 100 Tier-II and Tier-III cities in India, with a total count of 2,525 stores as of October 2025 and a combined area of around 13.0 million sq ft.

“Quick-commerce operators are seeking fulfilment infrastructure in urban and near-urban consumption hubs such as Navi Mumbai, Thane, Talegaon and Bengaluru, but the availability of suitably located, large and compliant assets in these markets remains limited,” Balani told Outlook Business.

Across metros such as Mumbai, Bengaluru and Delhi-NCR, and Tier-II markets including Coimbatore, Jaipur and Indore, quick-commerce operators now require hyper-local dark stores and micro-fulfilment centres, typically within a 5–10 km radius of dense consumption clusters, to support delivery timelines of 10 to 30 minutes.

This operating model, according to Welspun One’s CCO, has redirected leasing activity towards compliant, automation-ready Grade-A facilities that offer higher clear heights, robust docking infrastructure, reliable power availability and stronger ESG credentials.

“As speed, predictability and throughput take precedence over headline rental costs, lower-spec Grade-B warehouses, often located on city peripheries and constrained by layout inefficiencies, are increasingly being bypassed,” Balani said.

Industrial and warehousing demand across the top eight cities remained strong in 2025, with leasing touching 36.9 million sq ft, marking a 16% year-on-year growth, according to a Colliers report. Delhi-NCR led overall demand with a 24% share, followed closely by Chennai at 22%.

After a relatively subdued third quarter, leasing activity picked up sharply in Q4 2025, reaching about 10.4 million sq ft. Chennai and Pune together accounted for 56% of the demand during the quarter. Pune and Mumbai also saw healthy activity, with around 5 million sq ft of space taken up in each city.

Third-party logistics (3PL) players were the biggest drivers of demand, accounting for 32% of total leasing, while engineering and e-commerce companies also recorded strong growth. At the micro-market level, Bhiwandi in Mumbai topped leasing activity with around 4.9 million sq ft of Grade-A space, followed by Chakan–Talegaon in Pune and Oragadam in Chennai, each seeing more than 2.5 million sq ft of uptake.

Ahmedabad leads with the largest average dark store size of about 6,600 sq ft, according to the Savills report, supported by ample warehouse availability and lower real estate costs compared with other metros. At the other end, Kolkata has the smallest average dark store size at around 4,700 sq ft. Major cities such as Delhi-NCR, Mumbai, Pune, Bengaluru, Chennai and Hyderabad typically range between 5,000 and 5,600 sq ft, while Tier-II and Tier-III cities average around 5,000 sq ft.

Aggressive Expansion in Quick Commerce

As dominant quick-commerce players such as Blinkit, Instamart, Zepto and BigBasket expand into newer areas, e-commerce giants Amazon and Flipkart have also stepped into the segment with their offerings, Amazon Now and Flipkart Minutes.

“The aggressive expansion of 10-minute delivery platforms reflects a broader shift in consumption behaviour, with customers expecting higher availability, wider assortment and near-instant fulfilment across categories,” said Welspun One’s CCO.

As these platforms move beyond grocery into electronics, lifestyle products and essential goods, and deepen penetration across Tier-I and Tier-II cities, demand is increasingly skewed towards a distributed network of smaller, well-located logistics facilities.

“This evolution has translated into incremental demand for institutional developers capable of delivering consistent, compliant infrastructure across multiple markets. Leasing momentum has increased for in-city, near-urban and port-adjacent assets in locations such as Thane, the MMR, Nhava Sheva, Bhiwandi and Chennai, where connectivity and replenishment efficiency are critical,” he added.