Knight Frank: Mumbai, Delhi-NCR and Bengaluru rank among APAC’s top 10 markets for logistics rental growth in H1 2026

According to Knight Frank’s Asia-Pacific Logistics Highlights H1 2026, the Asia-Pacific (APAC) logistics market recorded 1.2% half-year-on-half-year (HoH) (6 months change) rental growth in H1 2026 over the past six months, with rents remaining broadly stable to moderately higher across the region. Mumbai at 5.3%, Delhi-NCR at 5.2% and Bengaluru at 4.4% recorded strong YoY rental growth, placing all three Indian markets among the top 10 APAC markets for annual rental growth.

India remained one of the most active logistics occupier markets in APAC, supported by sustained manufacturing growth, domestic consumption and ongoing supply-chain diversification. Demand was broad-based, with manufacturers, e-commerce companies, retailers and third-party logistics (3PL) providers seeking modern facilities to accommodate larger inventories, automation and increasingly sophisticated distribution networks. Growing investments linked to semiconductor and advanced manufacturing supply chains also supported occupier activity.

Across APAC, 15 of the 18 tracked cities recorded stable or increasing rents in H1 2026. Leasing activity was largely driven by relocations, consolidations and upgrades, as occupiers adopted a more disciplined approach to their logistics footprints and focused on improving operational efficiency and network performance. This continued to support a flight-to-quality, with demand favouring modern warehouses offering better functionality, technology integration and sustainability credentials.

While elevated availability in select East Asian markets kept rental growth measured, supply-chain diversification and manufacturing investments continued to provide a strong demand catalyst for India. The combination of resilient occupier demand and preference for higher-quality facilities is expected to keep India’s key logistics markets relatively well positioned within the broader APAC landscape.

India’s logistics markets maintain positive rental momentum

Mumbai Metropolitan Region (MMR) recorded the strongest annual rental growth among the three key Indian markets, with rents rising 5.3% year-on-year (YoY) (12 month change) and 4.4% (HoH) during H1 2026. Prime rents stood at INR 26.00 per sq ft per month, while vacancy declined to 13.5%. The market balance remained balanced, with the 12-month rental outlook indicating further growth.

Delhi-NCR recorded 5.2% YoY rental growth and a 2.8% in HoH terms in H1 2026. Prime rents stood at INR 22.30 per sq ft per month, while vacancy declined to 14.7%. The market remained balanced, with the 12-month rental outlook pointing towards further rental growth.

Bengaluru registered 4.4% YoY rental growth, with rents increasing 2.2% during H1 2026. Prime rents stood at INR 23.50 per sq ft per month, while vacancy declined to 17.6%. The market remained balanced and the 12-month rental outlook remained positive.

Shishir Baijal, International Partner, Chairman and Managing Director, Knight Frank India, said, “India’s logistics sector continues to demonstrate strong structural resilience, supported by sustained manufacturing activity, domestic consumption and the ongoing diversification of supply chains. The healthy rental growth recorded across Mumbai, Delhi-NCR and Bengaluru reflects sustained occupier demand, even as the market becomes increasingly selective about location, connectivity and asset quality. With occupiers placing greater emphasis on operational efficiency and modern, institutional-grade facilities, we expect India’s logistics real estate market to remain on a steady growth trajectory in the near to medium term.”

APAC logistics market continues to favour quality and efficiency

The APAC logistics market has entered a more mature phase of the cycle, with occupiers increasingly focused on the quality and efficiency of logistics facilities rather than simply securing additional capacity. The availability of a broader range of options is enabling occupiers to optimise portfolios, consolidate operations and upgrade into higher-specification facilities. Knight Frank expects rental growth across the region to remain measured, with rents expected to remain largely stable and growth below 2% in H2 2026. At the same time, supply-chain diversification and manufacturing investments are expected to continue supporting logistics demand in India.

Tim Armstrong, Global Head of Occupier Strategy and Solutions, Knight Frank, said, “The Asia-Pacific logistics market has moved into a more mature phase of the cycle, where occupiers are focusing on the type of spaces they occupy rather than simply securing capacity. With rental growth remaining measured across much of the region and a broader range of options available, occupiers have greater scope to optimise portfolios, consolidate operations and upgrade into higher-specification facilities. We are seeing leasing decisions become increasingly selective, with stronger emphasis placed on longterm efficiency, sustainability and operational resilience. This is contributing to a growing preference for modern assets that can support automation and evolving supply chain requirements. For occupiers, current market conditions in the region represent a compelling opportunity to secure better spaces at competitive terms and align portfolio strategies to support long-term business objectives.”