DDA amends master plan to increase FAR, ground coverage for warehousing

NEW DELHI: The Delhi Development Authority has approved the FAR (floor area ratio) in warehousing from 80% to 100% and ground coverage from 30% to 40% to give a boost to warehousing demand in the capital.

The authority had to amend the Master Plan of Delhi (MPD) to bring about the changes.

“Due to lack of favourable policy, most of the e-commerce players preferred to acquire space in Gurgaon. With some changes, we are looking to make Delhi a hotspot for the warehousing industry,” said an official at the authority.

It has also reduced the number of days taken for sanction, plinth and OCC to 44.5 days from existing 50.5 days.

While there has been demand for warehousing space in NCR, most of the activity is limited to Gurgaon because of favourable policy and easy land availability.

The UP government has also recently reduced the cost of land acquisition for warehousing, which will provide further fillip to demand in Noida.

“Covid-19 like situations have given occupiers even more reasons to secure locations in close proximity to their customer base,” said Anuj Puri, Chairman, ANAROCK Property Consultants. “One of the cost-effective ways to do this in expensive cities like Delhi is to move into multi-storey warehouses – of maybe five or six storeys or higher – where each floor provides well-serviced warehousing with decent floor loading.”

Warehouses in the NCR have witnessed 13.9% vacancy levels, compared to other markets such as Bengaluru and Pune which have vacancy levels of 29.7% and 21.8%, respectively.

Real estate experts have said that Indian warehousing industry will witness mushrooming of multi-level warehouses in metro cities as ecommerce players look for quicker deliveries amid a space crunch in Delhi and Mumbai that inhibits developers from acquiring large pieces of land.

“With changing time and introduction of numerous online shopping sites, the demand for ‘warehouse to home’ model of business has increased the need of warehouses for various commodities,” said an official at the authority.

Besides facilitating maximum land utilisation in cities like Mumbai, multi-storey warehousing can help companies reduce transportation costs and improve delivery time—curial for success in most retail businesses.

“We have seen border closure of Delhi during various events and e-commerce players are looking for space within the capital to serve the residents. With some policy changes, we will see fresh development of warehouses in Delhi, however the authority should consider increasing the ground coverage further,” said Mudassir Zaidi, Executive Director (north), Knight Frank India.

According to a Knight Frank India report, warehousing demand in India has seen strong growth over the last few years and has recorded a 44% increase in CAGR since 2017.