How 10-Minute Delivery is Reshaping Warehousing in Urban and Tier-2 India

India's quick-commerce (Q-commerce) sector is experiencing rapid growth, leading to a significant increase in demand for small, hyperlocal warehouses. These micro-fulfilment hubs are transforming urban logistics, impacting rental dynamics, and expanding into Tier-2 cities, as per news reports.

Surge in Demand for Hyperlocal Warehousing

The rise of Q-commerce platforms like Blinkit, Zepto, Swiggy Instamart, and BigBasket Now is driving the need for small, hyperlocal warehouses. These platforms aim to fulfil deliveries within 10-15 minutes, necessitating last-mile fulfilment centres located in dense residential neighbourhoods. Experts estimate that the demand for such warehouses is three times that of traditional large-format warehouses.

Repurposing Urban Spaces for Micro-Fulfilment Hubs

Underutilised urban spaces, such as old neighbourhood shops, defunct service apartments, and ground-floor office spaces, are being converted into efficient micro-fulfilment hubs. This strategic repurposing allows companies to establish a dense network of hyper-local fulfilment centres, bringing inventory closer to customers and optimising delivery times.

Expansion into Tier-2 Cities

While metros remain the primary focus, Q-commerce companies are expanding into Tier-2 cities like Jaipur, Coimbatore, Nagpur, Lucknow, and Surat. Improved digital penetration, rising disposable income, and consumer demand for convenience are driving this expansion. In cities like Coimbatore and Indore, short-term leases for 1,500–3,000 sq ft units are increasing, with local developers converting underutilised properties into rentable dark store formats.

Read More: India's Quick Commerce TAM Expected to Reach $57 Billion by 2030! 

Impact on Real Estate and Rental Dynamics

The rise of hyperlocal warehousing is influencing rental dynamics in urban areas. Rents for ground-floor spaces in residential-commercial mixed-use zones have increased by 10-18% in key micro markets since 2023. Companies like IndoSpace are developing in-city warehousing hubs, such as INLOGIS Chembur in Mumbai, to support hyperlocal fulfilment and reduce delivery times.

Projected Growth

The Q-commerce sector is projected to reach $5.5 billion by 2025, according to RedSeer Consulting. Industry estimates suggest that India may require over 12–15 million sq ft of small-format warehousing space in the next three years to meet delivery demand from urban and Tier-2 consumers. This growth presents new monetisation avenues for developers, especially in land-constrained metros.

Conclusion

The 10-minute delivery boom is reshaping India's urban logistics landscape. The demand for hyperlocal warehouses is driving the repurposing of urban spaces and expanding into Tier-2 cities. As the Q-commerce sector continues to grow, it is expected to significantly impact real estate dynamics and infrastructure development across the country.

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