Warehousing can be considered as an important driver of realty growth in the current scenario. First of all the meanings of Logistics and Warehousing need to be deciphered in the context of real estate sector and then how they act as a driver of realty growth.
As far as Logistics is concerned, it can be defined as the whole process of obtaining material from resources, converting it into finished products and supplying it to the end-users involving procurement, transportation, storage, warehousing and distribution, financial and performance aspects and so on and so forth. Logistics can be considered as the whole system and Warehousing is considered as the crucial part of the whole system without which logistics cannot function.
Warehousing is holding of inventory at a location, which is a planned space for handling and storage of goods and materials. Warehousing creates streamlining and time utilisation by storage of goods throughout the year and their release via distribution as and when required. Warehousing is a sub aspect of logistics, which is the complete process of planning, controlling and execution of storage goods from starting stations and movement of the finished products to their end destinations.
Now the question arises, which factors make warehousing as an important driver of realty growth and the answer tantamounts to ‘Supply’ and ‘Job Creation.’ To satiate the overwhelming demand of various aspects in realty sector at all levels, timely ‘Supply’ has to be delivered and this is what logistics and warehousing is all about. Now the whole scope of this is so vast that it creates a large number of jobs at all levels. Warehousing can be considered as holding of inventory which can be property, goods in stock, and contents of a building which have to be delivered as and when required.
Now as deciphered above, if this whole process of logistics and warehousing is executed timely and dexterously, it acts as an important driver of realty growth. For example, as the data reflects that logistics and warehousing leasing increased by 50% in top 8 cities in H2 2017, it is going to have a positive impact on the residential sector.
The increase in leasing of logistics and warehousing reflects increase in the activity of the same and more job creations at all levels for all aspects of the whole process from the start till the end.
Now as more people shall get employed at different locations due to the whole process of logistics and warehousing, more residential accommodation shall be required leading to increase in demand for the residential sector. Logistics and warehousing has varied dimensions in different processes and whenever there is an upsurge in demand for the same, all these processes from start till the end require human resources to be employed at different levels in different dimensions and for supporting infrastructure also. This leads to the requirement of their residential accommodation at varied places generating and increasing the demand in the residential sector.
This whole perspective indicates an upsurge in demand in the residential sector which shall give a boost to the home sector in particular and realty sector in general. Logistics and warehousing can be considered as an important aspect of real estate and different aspects of real estate are inter-related and overlapping, if any one aspect prospers, it shall bring prosperity to other aspects as well. Therefore the overall impact is going to be positive with increase in demand in the residential sector and an overall growth in realty.
(As told to Mini Tejaswi)