Assets Under Management AUM

India’s Warehousing and Logistics Segment Sees Rise in Investments from NRIs and HNIs

India’s warehousing and logistics segment is witnessing an increase in investment from Non-Resident Indians, High Net Worth Individuals and Ultra High Net Worth Individuals (HNI and UHNI), who, according to experts, are keen to diversify their portfolio.

The rise is attributed to India’s promising economic growth, the rapid growth of e-commerce businesses in the country, systematic reforms such as the implementation of goods and services (GST), and the potential for better returns.

In the past, NRIs and HNIs have typically invested in residential and office assets.

According to Abhijit Verma, executive director of Avigna Group, which raised capital from HNIs to invest in warehousing, the segment offers an 8-10% return with rising rents and has been a risk-averse segment for the pandemic.

Furthermore, private equity funds and real estate developers are also starting to focus on the warehousing and logistics segment, which is expected to strengthen and attract more investment in 2022, driven by demand from market players. e-commerce and third party logistics (3PL). .

“Investor interest in warehousing has been extremely high relative to commercial due to secure tenancies and declining tenant turnover,” said Ashish Joshi, founder of Landmark Capital. “The size of the warehousing investment is also manageable, easier than a commercial office.”

The uncertainty created by the pandemic has been a boon for e-commerce and acts as a catalyst for the warehousing and logistics industry.

“We are planning to have an additional 4 million sq ft warehouse by the end of next fiscal year. The average investment is over Rs 35 lakh in this segment,” said Sudarshan Lodha, co-founder of Strata, a commercial real estate investment platform. .

The company plans to increase its assets under management (AUM) to Rs 900 crore by the end of FY22.

Warehousing and logistics continue to see increased interest from investors, with logistics accounting for 20% of total trading volume. Investments in data centers have also started to pick up with a few joint ventures announced lately.

Warehouse size is expected to increase in 2022 as companies seek to transition from the opex (operating expense) model to the capex (capital expense) model. The size of the box has grown significantly – from 20,000 square feet five years ago to even 1 million square feet now.

According to data from