Chennai has always been a popular hub for trade and commerce. Being a port city, it acts as a central location for many online retailers, multinational firms, and other enterprises. Over the years, it has also gained the attention of the automobile industry. Their presence has expanded Chennai into a manufacturing hub. This, in turn, has spurred the need for warehouse facilities in the city. These facilities, evolving around multiple highways branching out from the center of Chennai, include some incredible rental warehouses. The advantages of choosing a warehouse in these areas of Chennai are many. The versatile roster of different types of warehousing solutions has been known to fit the needs of every business from different industries.
Most of the warehouses in the newer areas are now shifting from the more traditional godown-type structures. Recent years have seen integrated logistics park operators enter the Chennai warehousing market. These logistics parks are characterized by state-of-the-art warehouses and represent the next stage of industry evolution. They are fully equipped to handle multi-modal transportation, centralized storage and distribution, and information transaction services. The new standard of facilities increases the overall demand from modern business merchants who want more automation, tracking, and accountability while minimizing personal effort. Over the last five years, several companies have shifted their space from older warehouses to newly constructed spaces.
1. Phenomenal location options
A vast majority of the warehouses in the city are close to the large consumption markets in the city. The ample availability of large tracts of developable land is the biggest advantage of getting a warehouse in Chennai. The locations within the Sriperumbudur/ Oragadam cluster have well-suited roads for truck traffic. These three-lane roads can also access all industrial destinations, including Maraimalai Nagar, Ambattur, etc. The locations near Sriperumbudur, Mannur, and Mappedu have access to the city center within 50–75 minutes of travel time. This vicinity offers roads that attract few passenger vehicles and is mainly used by the industrial and logistics players. This makes it less prone to traffic congestion.
North Chennai has been relatively less impacted by the increasing demand for residential and commercial development than South and West Chennai. Hence, housing suitable land for rent at a more reasonable price for warehousing activities. Considering the city’s development and increased attention from B2B companies, the warehousing requirement is likely to grow even further.
2. Easy availability of a workforce
Every warehouse requires a dedicated workforce to perform at its maximum functionality. North Chennai is home to a traditionally large blue-collar population. Thus, the availability of ample skilled and unskilled workforce provides another advantage to this warehousing cluster. All the employees of the warehouse form a steady backbone for it. It becomes impossible for all objectives to be fulfilled in case of workforce shortage in sparsely populated areas. The boom in the online retail industry and the subsequent development of warehousing have drastically increased the need for competent warehousing employees. Chennai is a hub of emerging warehouses with IoT functionality, and the city’s modern workforce has adapted using technology as a part of their daily tasks.
3. Significant growth opportunity
Warehousing was already in growth mode due to positive goods and services tax (GST) implications. Increased institutional capital is expected to be directed towards warehousing to meet this demand. It will lead to an accelerated pace of growth in the coming years and will observe the addition of many new towns in this footprint. Hence, Chennai serves to be the perfect place for businesses that may want to upscale their business by expanding within the same area with easy to rent spaces. Moreover, every warehousing space is surrounded by factories and production plants from multiple industries. It makes Chennai an excellent space for local networking, a proven method to get in touch with new clients.
4. Cost feasibility in various warehouse clusters
The Periyapalayam cluster has emerged as a promising warehousing corridor in Chennai because the key warehousing industry players of Chennai have been taking up space in that region. Most of the locations on this belt are feasible for warehousing activities at the prevailing land rates. The Periyapalayam Road does have the pricing dynamics today to support returns of over 16% for investors. This belt attracts warehouse owners and occupiers due to reasonable rent and competitive ownership values.
5. Industrial concentrations in Western Chennai
Western Chennai locations are established industrial concentrations in Chennai that form regional bases for the auto industry leaders. The automobile sector requires its vendors to be within a 1–2 hour driving radius from their base. Hence, the demand for warehouses in this vicinity has been growing exponentially. This cluster has thus evolved as the dominant warehousing market in Chennai, also known as the transportation and logistics hub of the city.
There have been profound developments of a robust logistic ecosystem with transporters, freight operators, and warehouse operators. Hence, despite the comparatively higher rental value, a large number of occupiers still prefer the warehouses in these locations. Their proximity to industrial hotspots and their logical ecosystem make Chennai incredibly appealing for occupiers. Another advantage is the excellent quality of road infrastructure when compared to other metropolitan cities like Delhi, Bangalore, and Mumbai where traffic jams have been a known cause of late deliveries.
The warehousing space requirement by the online retail segment has been the main cause of the increased demand for warehouses in Chennai. Modern fulfillment centers have set a new industry standard and changed the fast-paced environment of logistics and warehousing. While the shift has been swiftly increasing in developed countries, places like Chennai have the manpower, the land, and the infrastructure that’s ready for the future of the industry.
StockArea is a one-stop solution to all your warehousing needs. In case you’re looking for warehousing spaces in Chennai, our team of professionals can provide the optimal solution for you and your business. From logistics services and inventory management to last-mile deliveries, our roster of services is focused on providing every business owner with a hassle-free warehousing solution.