International Logistics Parks The Indian Way

Contents
Sr. No I II III IV V VI VII VIII Topics Concept & Need of an International Logistics Park Concept of Regional Hub & Demand & Supply Mumbai Region - Bhiwandi Emerging Warehouse Hub Operational Challenges Bhiwandi Warehousing Hub Renaissance Logistic Park A Snapshot Key Learnings & Best Practices Client Expectation & Needs Satisfaction Business Proposition & Way Forward

I. Concept and Need of International Logistics Park

Global Logistics Industry (LI) Scenario

Global Logistics Industry (LI) = US$ 3500 billion Indias Logistics Industry (LI) = US$ 66 billion Indias LI % to Global Industry = 1.90 %
International Logistics Performance Index (LPI) LPI depends upon the following areas: 1. 2. 3. 4. 5. 6. Infrastructure : Quality of trade & transport related infrastructure Logistics competence : Competence and quality of logistics services Timeliness : Timeliness in shipments in reaching destination within the scheduled or expected delivery time Tracking & Tracing : Ability to track & trace consignments International shipments : Ease of arranging competitively priced shipments Customs : Efficiency of clearance process

Rank 1 2 7 8 15 27
Source: World Bank LPI Survey 2010

Country Germany Singapore Japan U.K. U.S.A. China India

47

Global Logistics Industry (LI) Scenario

International Spends on Logistics Management Logistics Spending (% of GDP) 9.50 % 10.50 % 11.00 % 18.60 % 13.00 % 3rd Party Logistics (% of total movement) 57 % 80 % 68 % < 10 %* < 10 %

Country US Japan UK China India

Lower the % of logistics spent to GDP, better is the logistics management Higher % of 3PL shows a higher share of organized players Developing countries spend excess on logistics management

Indias LI Scenario
F.Y .2009-10 Particulars (Rs. In 000' Present Logistic % Share (US $ in Bn) Cr) Market of India FY 100% 125.00 625.00 India's Total Logistic Market 2009-10 Organized 6% 7.5 37.5 Unorganized 94% 117.5 587.50 Future F.Y .2012-13 Particulars (US $ in Expected Logistic % Share Bn) (Rs. In 000' Cr) Market of India for India's Total Logistic Market 100% 135.00 560.00 the F.Y . 2012-13 Organized 14% 18.90 94.50 Unorganized 86% 116.10 580.50 Present

Indias Logistic Market : Expected growth of CAGR of 8% p.a. over the next 3-5 years.

Overall Indias Logistic Market Growth rate is 18% - 20% p.a. in the year

Indias Expected in Investment is LI by 2015 USD $350 billion.

Organised LI in India
60 50 40 30 20 10 0 4 India US Europe 34 54

India's Total Logistic Market

6% Organized Unorganize d

94%

Share of organised LI in India : 6% Need of the hour : International Quality of Logistics Parks Without this vital infrastructure, the cost of Logistics Industry will also

stay higher & the efficiency will be low.

II. Concept of Regional Hub & Regional Demand & Supply

Potential Regional Hubs in India

JLL Warehousing Hubs
1 NCR Mumbai Bangalore Kolkata Chennai Hyderabad Pune Ahmedabad Surat Goa Chandigarh Kochi Vishakhapatanam Nagpur Coimbatore Kochi Trivendrum Vizag - Kakinada

Mckinsey High Growth (ProductionConsumption) Clusters

NCR Mumbai Pune - Nashik Bangalore - Mysore Kolkata Chennai Hyderabad Mumbai Pune - Nashik Surat - Ahemdabad Surat - Ahmedabad

3 4 5 6 7 8 9 10 11 12 13 14 15

Coimbatore Salem

Logistic Parks Demand Factors

Major Demand for Logistics comes from:
Industrial Activity

Automobile Industry Electronics & Electrical Industry Textiles Industry Machine & Engineering Chemical & Pharmaceuticals Food Processing Industry Manufacturing SEZs
Agricultural Retail Sector EXIM Cargo

Demand Parameters in Top 8 Locations

Location
NCR Delhi Mumbai Chennai Kolkata Bangalore Hyderabad Pune Vishakhapatanam

S.N. 1. 2. 3. 4. 5. 6. 7. 8.

Demand Factors Industry (Auto, Textile, Electronics, Machine &Engineering, SEZs), retail, & agriculture Industry (Electronics, pharma, textiles, auto -components), retail, agriculture, EXIM cargo Industry (Auto, electronics, textiles, SEZ), retail, EXIM cargo Agriculture, EXIM, retail Industry (Electronics, textile, auto), retail, agriculture Retail, industry (Pharma) Industry (electronics, auto, textile/garment), retail EXIM cargo, industry (Chemicals & pharma, SEZ),

Supply Scenario of Logistics Space

Number of CWC Place/ City Warehouses NCR Delhi 25 Mumbai 18 Chennai 4 Kolkata 11 Bangalore 7 Hyderabad 1 Pune 2 Vishakhapatana m 4 Number of ICD/ CFS 12 30 20 7 3 2 2 4

otal CWC Capacity in 8 Locations (MT) S.N.

1200000 1000000 800000 600000 554016 400000 200000 0 NCR Delhi 182098 114730 104136 94545 20285 29378 Chennai Bangalore Pune 1015123

1 2 3 4 5 6 7 8

CWC is the biggest player in Logistics sector with operations from Agriwarehouses to ICDs

Establishment of ICDs/CFSs offer advance logistic facilities and play important role in organized logistic activity

III. Mumbai Region Bhiwandi Emerging Warehouse Hub

Key Logistics Hubs in MMR

Aver age Rent als

Establis hed/Eme rging Logistic Hubs in Mumbai

Bhiwandi Panvel Taloja Trans Thane Creek Rasayan i Patalgan ga

Rs/ Sq Ft/ Mont h

13 17 20

Land Cost Rs in Crores/ Acre

1.00 2.00

16 15

Focus: Bhiwandi City

SN 1 Current Market Trend Of Rental Rate Of Warehousing Complex In Bhiwandi Warehousing Complex A Grade Warehouses B Grade Warehouses C Grade Warehouses Rent Per Sq.Ft. Rs.15 Rs.18 Rs. 11 Rs.14 Rs. 8 Rs.10 2 3 4 5 6 7

Sectors Textile Sector Automobile Sector FMCG Sector Pharma Sector Cement Sector IT Sector Other Total

% Share 6% 32% 18% 14% 4% 16% 10% 100%

Main Users / Sectors of the Proposed Product

Focus: Bhiwandi Warehousing Hub

Buyers Segment / Key Players In Various Industries Road Express Gati Safexpress TNT TCI Buyers Segments/ Players in various Industries Air Express Bluedart Gati

Warehousing Industry CWC DHL logistics AFL Om Logistics Safex Delhi Assam

Courier Industry Bludart First flight AFL DTDC Overnight Professional Courier

Roadways Patel Roadways DHL Schenker BAX Semb Corp Panalpina Agil Freight Logistics

Source : CII Report, World Bank Survey, Report by Cushman and Wakefield, REC, ASSOCHAM Survey

Future Demand
Future Demand for Warehouses for Year 2010-2015
Switchover of Corporate from illegal Warehouses in Bhiwandi Agro & Industrial Need for Warehouses Retailing Sector Need for Warehouses Export & Import (Cargo Handling) Need for Warehouses Total Warehouses Space Demanded in Bhiwandi Sector

13% 2%

50%

22%

13%

Switchover of Corporate
from existing Illegal Warehouses

SN 1 2 3 4

Particulars Switchover of Corporate from illegal Warehouses in Bhiwandi Agro & Industrial Need for Warehouses Retailing Sector Need for Warehouses Export & Import (Cargo Handling) Need for Warehouses Total Warehouses Space Demanded in Bhiwandi Sector

Area in Mln Sq.Ft. 15.00 2.40 25.00 15.08 57.48

Future Demand
Agro & Industrial need for Warehouses 2010 - 15
Area in Lac Sq.ft . 8.67 2.40 1.00 7.58 0.09 3.92 24.00 2.40

SN

Industrial Sectors Agriculture Metal Chemical Petrochemica l Pharmaceuti cal Cement Total ( I to VI ) Converted into Million Sq.Ft.

I II III IV V VI

Future Demand
Retail Sector need for Warehouses 2010 - 15
Particulars No. of Units Warehouse Space Required (Mln sq.ft.) Retail : WH = 1 : 0.50 45.00 14.00 10.00 40.00 6.00 10.00 125.00 Need in Mumbai & MMR Region (Mln Sq.Ft.) 20% 9.00 2.80 2.00 8.00 1.20 2.00 25.00

Shopping Malls Hyper Market Dept. Stores Super Market Mega Specialty Stores Exclusive Brand Outlets Total

225 280 400 3,200 1,200 20,000

Allowance of FDI in Retail sector (Single brand & Multi-brand), number of Malls, Hypermarkets, Supermarkets will increase in the coming years. Leading Corporates like Pantaloons (Big Bazaar), TATA (Westside), Reliance (Hypercity), Bharti Retails, Rahejas (Shoppers Stop), Reliance Retails, DLF Shopping Malls, Bata, Archies, Crossword and other global players are in the foray. Retail market is growing at 20%- 25% p.a.

Future Demand
Export & Import (Cargo handling) need for Warehouses 2010 15

Addl. Coastal Cargo Handling Space required Addl. Air Cargo Handling Space required Total Area

150 Lac Sq. Ft. 0.76 Lac Sq. Ft. 15.08 Mln Sq. Ft.

IV. Operational Challenges : Bhiwandi Warehousing Hub

Major Issues faced by Operator

in Bhiwandi Warehousing Hub
S.N 1 Absences of Legal and Marketable title for warehouse No common facilities & amenities in warehousing complex Non-compliance of Development control rules & legal approvals Substandard warehouse building with broken floor. Cracked walls, heating, dusty environment etc No human Interface in terms of toilets, restrooms, food courts hygiene Absence of planned complex Absence of Infra & Utilities of world class levels Local issues of various monopoly of varia, local transport, labour supply, security etc No specialised facilities for temperature control , cold storage, chemical storage high cost good storage in

Non-compliance Building for modern facilities like Racking system, forklifts, dock leveler etc Water logging flooding & termites Insects pests creating lot of goods lost

Non-compliance of fire & safety norms hence loss of insurance cover

V. Renaissance Logistics Park

Bhiwandi

A Snapshot

Master Plan - Renaissance

Sr. No A

Project Particulars Summary

Project promoted by Special Purpose Vehicle

Description
Renaissance Infrastructure 376 acres of Integrated Warehousing and Industrial Complex - Standard Warehousing complex of 120 acres - Green Industrial Complex of 80 acres - BTS Warehouse complex of 62.5 acres - BTSIndustrial Complex of 95 acres + 9 acres Commercial spare of 9 acres 138 Units - Each 6,250 sq ft Small plot with building 24 Units - Each 18,750 sq ft large plot with building 1360 Units - Each 2065 sq ft Industrial gala 27 buildings 2 million sq. ft. area 3 lac million metric tonnes storage capacity

Type of Project

Green Industrial Units

Warehousing Capacity

Unique Selling Propositions

What makes Renaissance Warehousing Business-class?
Assurance 1 2 3 4 First 100% Legal Warehousing complex in Bhiwandi The project is promoted by the Special Purpose Vehicle(SPV) and is being developed under the approvals granted by Central and State Government to SPV All land rights are in the name of SPV, further transferred to buyer ensuring 100% title legality The complex is master planned, designed and executed by PMC approved by Government of India

Business Class Facilities 1 The superior warehousing facilities speed up the throughput time and efficiency of the business operations from checking into terminals, docking unloading, loading, palletizing and checking out. 46 ft. exclusive road for every building with 68 ft. main road and 121 ft. (8-lane-one way) circular loop road around the entire complex The complex comes with world-class exclusive common facilities: Inbound and outbound truck terminal HRD training centre Food courts, commercial complex, trade centre Warehouse support services outlets Logistics equipment and service centres Goods storage, trading and display support services The complex will have all MIDC equivalent facilities of roads, water distribution, power supply, drainage, security system and fire fighting system The fire fighting station located within the complex The complex will be professionally managed by a dedicated Operations and Management team headed by the CEO

Contd
2

4 5 6

Business Class Design 1 All 27 buildings of the warehousing complex are branded world-class PEB structures The new warehouse structure has exclusive features of building insulation, air-conditioned, racking compliance and exclusive road for each warehouse building with controlled access Screwless, standing seam roofing (SS 2000): Puncture- free roof system, roofing system is designed to handle expansion and contraction of the sheets during high temperature variations and avoiding corrosion FM II (TR34) compliant flat floor for safety, precision, wide and narrow aisle racking arrangement. Strong reinforced, abrasion crack and dust resistant floor designed for racking and forklift loading Poliginus reflective insulation: Heat insulated (reduction of 7C when outside temperature is 45C plus), fire retardant, improves work efficiency and offers safer storage of goods. Pallet compliant flooring: The warehouse layout (length, breadth and height) is compliant to positioning of heavy duty racking system and designed to maximise the number of pallet positions Continuous canopy of 6 m over-hung with Soffit

Contd

6 7

Location

Location of Future

1 2

Ring Road MMR Plan Location Plan

Proposed Ring Road - MMR Plan

Location Map

Project Land & Approvals

100% Marketable Title & Freehold Property

1 2
Step 1 to 6 to make property 100% marketable to freehold SPV transfer the title to the buyer or purchaser

World Class Infra

Road Section

Traffic Management: Facilitating Business

Facilitating a smooth flow: Our world-class traffic management systems are strategically planned to ensure that your goods move business-class. The terminals, wide central roads, directional guides, signages, inter-connected roads leading to warehouse and other units are planned for smooth flow and hassle-free movement.
S.N A Truck Terminal The truck terminal has been designed considering the length of the containers (60 ft., 40 ft. and 30 ft.), with a parking capacity of 100 trucks. C Entrance Management For every truck which enters, the security checks for vacant space in the respective warehouse. Trucks will be permitted to enter the premises only if there is room else will be instructed to be parked in the truck terminal until availability of space in that warehouse. D Security Post Each entrance has a security cabin responsible for screening all the vehicles entering, coordinating on the availability of space with the warehouse in-charge and directing them towards the truck terminal or the respective warehouse.

Facilities in Truck Terminal a. Canteen / Mess b. Driver Dormitory c. Shops

S. N

Contd
Vehicular Movement One-way movement of all trucks Two loop roads to facilitate movement of the vehicle internally (in case of wrong turns) G Traffic Flow Management Internal signage assisting smooth vehicular movement One-way traffic for incoming vehicles Efficient traffic management staff controlling the traffic flow

Road System 121 ft. central complex road (8-lane, two-way) 68 ft. main road (4-lane, oneway) 46 ft. warehouse internal road (one-way) Industrial tonnage cement concrete road Road illuminated with sodium vapour lamp Loop road for quick

Built-to-Suit: Provisions & Possibilities

At the Renaissance warehouse, our structures have been designed in a manner that allows us to incorporate certain additions as per your unique business needs. For example, if your wares need temperature control, you require a ceiling higher by a couple of meters. At the Renaissance warehouse, there are various such possibilities along with the trust of getting the additions done through the same expert team that has designed this worldclass structure. Below is a comprehensive list of built-to-suit provisions and possibilities over and above the standard elements.

S.N 1

Elements Height

Customization possibilities Standard ceiling height: 8 m Built-to-suit provision: Height can be extended up to 10 m Built-to-suit possibility: Racking can be created with various financial options Standard Flooring: M25 grade, 150 mm thick, steel fibre reinforced concrete (SFRC), Dry Shake Hardener with Liquid Surface Hardener (LSH) Built-to-suit possibility: Depending on the business need, flooring with greater weight-bearability can be created

2 3

Racking Flooring

S.N 4 5

Elements Contd

Customization possibilities Built-to-suit possibility: Mezzanine floor can be created as per the occupiers need Built-to-suit possibility: In case the wares require temperature controlled environment, the same can be created on demand Built-to-suit possibility: Walk-in cold room can be created In case the occupiers need to use a portion or the unit for office purpose, the same can also be designed and created in a fully-functional format depending upon the needs Standard offering: The structure comes with 265 lights Built-to-suit provision: More lights can be added as per the need Our warehouse is compliant with various business types, including: Pharmaceutical Industry 3 PL & 4 PL Logistic Studio Low cost IT Agricultural Warehouse

Mezzanine Air Conditioning Cold Room Office Space

6 7

Light

S.N 1 2

Elements Contd Interiors - Office & Toilet Design Changing & Locker Room Mezzanine Floors

Built-to-suit options Provision of office at entrance of the warehouse.

Value Generation Customization

Toilets at entry side of the Customization warehouse for executives and at exit side for labor and drivers Provision of changing & locker rooms for workers Provision of mezzanine floors of required size for office purpose, as per requirement Provision of racking system pallet location - 11457 nos. Provision of dock leveler for easy loading and unloading, as per requirement Provision of air-conditioning of required tonnage Customization

4 5

Heavy-duty Racking System Dock Levelers

Customization Customization

Air-conditioning

Customization

VI. Learnings & Best Practices

Locating & Land Acquisition

of Logistics Park
S.N 1 Critical issues Fragmented ownership of land Defective title Problems Consolidation of land No marketable title No possession of land Non transferability of land Learning / Best practice Local facilitator / Aggregator having in depth understanding and relation in village Comprehensive title search since 1957 (day), court search, forest search etc Strong local team with surveyor having understanding of land possession Local connect from collector office to talathi inhouse team of experienced people to follow through & get complete approval Local Influential people part of land acquisition parcel to manage

Title holder not having possession Land approvals

Local Mafia

Stopage of work

Approvals
of Logistics Park

Design & Engineering

of Logistics Park

Development
of Logistics Park
S.N 1 Ideal steps to follow the development of Logistics park Earth work to achieve desired level - 2 to 3 meter above high flood line (HFL) - Nothing coordinates to create a grid for Vastu Compliance - All Building at zero degree - Highway class lanes - 3 to 4 meters utilities corridors - Continuous source of water (Ideal from irrigation department) - STP to recycle water for irrigation & Flushing - Fire fighting system, fire station & CFO compliance certificate Standard building & Built to Suit plots Optimise FSI Utilisation Centrally located open spaces & landscaped areas At least 10% as open space 5% common facilities & amenities Common facilities & amenities location

2 3 4

Road & storm water network through the complex Utilities corridors & Ducts Locating WTP, STP, UG tanks, Fire station

6 7 8

- International standard for warehouse building - Plotting out area for building in project - Specialised contractors to execute specialized job - Always reside people around complex travelling is most energy draining activity - Residential Complex for work to work with all township amenities

Local Issue Management

Critical issues Varai Problems Monopoly of Loading and unloading by locals Learning / Best practice 1. Create local representative bodies 2. Laid out policies for non interface by locals 3. Take land on joint development & made properties for letting out for villages 4. Created fix compensation for village development 1. Labour contractor with license & compliance on market driver pricing 2. Objective to provide services to occupier 3. No monopoly in labour supply 1. Transportation in local 2. Tempo station on market driven pricing 3. No monopoly 1. Creates 3 to 4 security licensed agency within village to provide services on market driven pricing & with quality of services 2. No monopoly 1. HRD centre to train people on logistics

Labour supply

Monopoly of Labour supply

Local transport

Monopoly of local transport

Security

Monopoly of security

Local employment

Fixed percentage of

Operation & Maintenance

Issues
Quality of Infra

Problems
Bad quality

Learning & Best Practices

Design & Build to last for decades

Quality of Utilities

Common facilities & amenities

Create & build most reliable utilities i.e. water supply, electric system, sewage system, wages system, drainage Non - reliability system, fire fighting Human interface ignored - Very human centric master plan & Lack of Restrooms, Food complex use plan, creating sweet-spots areas, Dormitories, around the complex & keeping it clean Provision stores & usable World class flooring complying FM standards Standing sun roof

Broken flooring, leakages, Insulation Warehouse Structure & fire, water-logging, insects Maintenance heat Fire-fighting system Professional & skilled facilities management company Operation Management & Run Logistics Park as a service Facilities Absence of professionalism operation like hotel, hospital

VII. Client Expectation & Needs satisfaction

Critical issues for client

S.N 1 2 3 4 5 6 7 8 9 10 11 Critical issue for client in operation of warehouse Flooring of warehouse Leak proof roofing Docking Bays with Dock levelers Security gates & gated complexes Truck terminal Fire fighting system & Insurance compliance Local issue Availability of skill & semi-skilled labour 24 x 7 operation Heating & humidity in summer Flooding & Water logging Learning (Best practice) - FM: Compliant, International certified flooring - Standing seem (Screwless roofs) - 1.2 meters Docking bay with dock levelers - Two level gated complex with security system - 5 to 7% of area dedicated for truck terminal - CFO Compliance & Certification - Local committees & fixed payments - HRD centers local population to be trained to be employable - Commutation facilities for 24 x 7 & residential facilities within complex - Insulation, Righ vents, Turbo Ventilation - 3 to 4 meters above HFL, effective storm water drainage

Critical issues for client

S.N 12 13 14 15 16 17 18 19 20 Critical issue for client in operation of warehouse 24 x 7 Power Solid waste & unclear Fast turnaround time Human Interface in term of clean toliets etc Hygiene Food Recreation to loose Fat Traffic swift mobility Area for commerce Maintainance of warehouse building equipment Learning (Best practice) - Express fidder, back up generator - Solid waste management & regular cleaning through facilities management - Excellent road, clear traffic movement, equipment loading & unloading, Highspeed connectivity - Public toilets, foot path, bus shelters, sitouts - Food courts lunch home, restaurants - Club facilities, Recreation grounds, gardens - Signages, location standies, instruction boards - Marketing centre, Exhibition Area, hotels Factory outlets. - Professional team for facilities management

VIII. Business proposition & way forward

Business proposition & Way Forward

Properties at Renaissance Logistic Park Bhiwandi Standard Building Lease Ready for Possession Area under construction Sale Area under construction for sale 3.0 lac sq ft 4.5 lac sq ft 10.00 lac sq ft Built-to-Suit Lease Ready to Build BTS under Negotiation Sale Ready to be sold under BTS 10 lac sq ft 15 lac sq ft 10 lac sq ft

Demand Supply Analysis

Bhiwandi , MMR Demand
Deman d Suppl y

Supply
Mn Sq. Ft.

% of RIs Supply to total Demand

57.48 Total Warehouses Space Demanded

12% 6.83
Mn Sq. Ft.

Total Warehouses Supply by RI 53.71 Mn Sq. Ft. Total Industrial Space Demanded Total Industrial Park supply by RI 5.65
Mn Sq. Ft.

11%

Total Industrial Township Demanded

48,13 0

No. of Accommodation required

47% 22,50 0
No. of Accommodation available

Total Industrial Township supply by RI

Thank You