Amazon India Signs Up Almost 1-million-sq-ft Warehousing Space in Shamshabad, South Hyderabad

Ecommerce main Amazon’s India unit has entered into an settlement with Warburg Pincus-backed logistics growth platform ESR to lease 1 million sq ft of warehousing house on the Shamshabad locality in South Hyderabad in one of many largest logistics offers within the nation, mentioned individuals with direct data of the event.

This facility is a part of a 66-acre logistics park growth on the Hyderabad Airport City. The park is being developed by GMR Logistics Park, a three way partnership during which ESR holds a 70% fairness curiosity and the GMR Group owns 30%.

This is the third long-term lease, totalling over 2.6 million sq ft warehousing house, inked by Amazon India in the previous couple of weeks.

The Shamshabad warehousing facility can be developed in two phases. The first section with 600,000 sq ft house can be delivered by May 2022 and the remaining 400,000 sq ft by the top of 2022.

“Registration of the agreement for this built-to-suit facility has already been concluded. To begin with, the rental for the space has been set around Rs 22 per sq ft,” mentioned one of many individuals.

Amazon India has leased the house for 9 years. The lease will begin in 2022 with the settlement offering for a rental escalation of 15% each three years.

ET’s e-mail question to Amazon India and ESR remained unanswered till the time of going to press. Transaction advisor JLL India declined to remark for the story.

Amazon India lately leased a 1 million sq ft warehousing facility at Devanahalli Industrial & Logistics Park in Bengaluru from Logos, a logistics and warehousing growth fund. It has additionally entered right into a pact with ESR to lease 606,000 sq ft in India’s greatest logistics cluster, Bhiwandi, within the Mumbai Metropolitan Region.

Following the Bengaluru transaction, Amazon India’s storage capability stands at greater than 43 million cubic ft throughout 15 states, supporting round 850,000 sellers. It is planning to develop its fulfilment community with near a 40% enhance in storage capability over final yr.

Demand for warehousing house has stood out in the previous couple of quarters, led by the growth of ecommerce and development of third-party logistics in the midst of the continued pandemic state of affairs.

Accelerated adoption of ecommerce, same-day or next-day supply commitments fulfilled by third-party logistics corporations, and the necessity to diversify provide chains are pushing demand for warehousing and logistics companies.

A beneficial regulatory setting, together with the federal government’s assist by means of coverage and reforms, is additional anticipated to spice up the spending in infrastructure and in flip the general demand for contemporary warehousing.

According to trade estimates, nearly one-fourth of the full warehousing house in India has been leased by ecommerce corporations akin to Flipkart and Amazon up to now two years.

This is anticipated to speed up additional as a result of change in the best way shoppers store following the outbreak of Covid-19. The development in demand for warehousing can be prone to entice investments on this house.