Unit holders in SEZs likely to start ops in H2 2019 to get tax benefits: CBRE
Tax incentives granted to both developers and occupiers of SEZs will expire on March 31, 2020.
Unit holders in special economic zones (SEZ) are likely to start operations during the second half of 2019 in order to avail tax incentives before the sunset date, according to property consultant CBRE.
This will ensure that space take-up in this segment remains high and vacancy levels remain in single digits at least till the end of 2019, it said.
Despite the sunset clause, a significant SEZ supply is lined up for completion until 2020.
Their focus will be more towards leasing existing space in their operational SEZs, while developing a more equilateral portfolio focusing on segments such as tech parks and corporate office spaces as well, it said.
"In case the government decides against modification of the sunset clause or extension of the sunset date, we can expect a rationalisation in the overall leasing activity in SEZs with occupier decisions based upon well-thought out CRE strategies rather than the tax benefits only," CBRE Chairman, India and South East Asia, Anshuman Magazine said.
Corporates looking for large contiguous spaces for consolidation might still continue to evaluate SEZs, irrespective of the sunset clause, he added.
The SEZ space accounts for about 22 per cent of the total office stock in India across seven leading cities.
(This story has not been edited by Devdiscourse staff and is auto-generated from a syndicated feed.)