Understanding Per Capita Warehousing Space: A Global Perspective

The demand for warehousing space is a critical indicator of a country’s logistical capabilities and economic development. When comparing per capita warehousing space across countries, the difference is often stark, especially between developed economies like the USA and emerging markets such as India. This disparity not only underscores the current gap but also highlights the enormous potential for growth in India’s warehousing sector.

The Numbers: India vs. USA

As of the most recent data:

• India: The per capita warehousing space stands at approximately 0.02 square meters per person (Source: JLL India).

• USA: In stark contrast, the USA has a per capita warehousing space of around 4.4 square meters per person (Source: Prologis), making it more than 200 times greater than India’s.

This massive difference reflects the advanced state of logistics infrastructure in the USA and the relatively nascent stage of development in India. The U.S. warehousing industry is highly mature, with significant investments in infrastructure, technology, and large-scale facilities driven by major retail and e-commerce players like Amazon, Walmart, and Target.

A Broader Global Context

To provide a fuller picture, let's look at some other countries:

• China: China has approximately 0.5 square meters per person (Source: CBRE Research), reflecting its rapid industrial growth and increasing demand for logistics infrastructure. Despite being significantly higher than India, it still lags far behind the USA.

• Germany: Germany boasts a per capita warehousing space of around 2.4 square meters per person (Source: Savills), indicative of its strong manufacturing base and efficiency in supply chain management.

• Japan: Japan's figure stands at about 1.5 square meters per person (Source: Knight Frank), driven by its advanced economy and the logistical demands of its export-driven markets.

These numbers highlight the stark contrast and the vast scope for growth in India’s warehousing sector, particularly when compared to global benchmarks.

Why the Difference is So Significant

Several factors contribute to this vast difference:

1. Economic Development: The USA and other developed countries have established economies with strong consumer markets, advanced manufacturing sectors, and extensive global trade networks. For example, Amazon alone accounted for 40% of all e-commerce sales in the USA in 2021 (Source: eMarketer), driving significant demand for warehousing. This demand is met with extensive warehousing infrastructure, including high-tech distribution centers that optimize storage and reduce delivery times.

2. Land Availability and Urban Planning: The USA has more land available for warehousing and industrial development. In contrast, India faces challenges related to land acquisition, urbanization, and regulatory hurdles, which slow down the development of large-scale warehousing facilities. According to a report by Knight Frank India, land acquisition and conversion issues are among the biggest bottlenecks for industrial real estate in India (Source: Knight Frank India).

3. Logistics Infrastructure: The USA’s logistics infrastructure is among the best in the world, with a vast network of highways, railways, and ports supported by extensive warehousing facilities. In 2020, the USA invested approximately $30 billion in logistics infrastructure (Source: Council of Supply Chain Management Professionals (CSCMP)), whereas India’s logistics infrastructure, though rapidly improving, is still in a developing phase. The Gati Shakti Master Plan aims to bridge this gap by developing seamless multimodal connectivity and reducing logistics costs (Source: PIB India).

4. Technology and Automation: Advanced economies invest heavily in technology and automation within warehousing. In the USA, companies like Prologis and DHL are integrating robotics and AI into their warehouses, improving efficiency and reducing the need for human labor (Source: Prologis). In India, while technology adoption is growing, the penetration of such advanced technologies is still relatively low, but the trend is upward, with companies like Delhivery and Ecom Express investing in automated sorting and warehousing solutions.

5. Consumer Behavior: Per capita warehousing space is also driven by consumer demand and e-commerce penetration. The USA, with a mature e-commerce market, sees higher demand for warehousing space to manage inventory and ensure quick delivery. According to a report by CBRE, the e-commerce share of logistics real estate in the USA is projected to increase from 30% to 50% by 2025 (Source: CBRE). While India’s e-commerce sector is growing, it still lags behind more developed markets in terms of scale. Learn more about how the logistics industry surged post-COVID due to the e-commerce boom.

   
   

The Opportunity for India

The stark contrast in per capita warehousing space between India and the USA underscores a massive opportunity for growth. As India's economy continues to expand and urbanization accelerates, the demand for warehousing space is set to rise significantly.

Key initiatives like Make in India and the National Logistics Policy are pivotal in addressing the current gaps in infrastructure and regulatory frameworks. According to Anarock Property Consultants, the Indian warehousing market is expected to grow at a CAGR of 20% and reach $19.5 billion by 2025 (Source: Anarock).

Moreover, investments from both domestic and international players are already flowing in:

• Indospace, a major player in Indian warehousing, raised $580 million in 2021 to expand its logistics parks across major cities like Chennai, Pune, and Bengaluru (Source: Economic Times).

• Ascendas-Firstspace, a joint venture between Singapore’s Ascendas-Singbridge and Firstspace Realty, is investing heavily in logistics and industrial parks across India, aiming to add 15 million square feet of space by 2023 (Source: Moneycontrol).

  
  

Invest in the Future with Warewitt

The surge in India’s logistics sector, driven by both e-commerce giants like Amazon and Flipkart, as well as innovative new-age companies like Zepto, presents a golden opportunity for investors. Warewitt is at the forefront of identifying high-potential industrial and logistics real estate assets. By focusing on strategically located assets that cater to the booming logistics industry, Warewitt ensures that your investments are not just secure but also poised for substantial growth.

To learn more about how you can capitalize on this transformative journey, explore Warewitt's offerings.