Left Menu
Development News Edition

Growth in office space leasing may moderate in 2020 after hitting record 58mn sq ft last yr: Savills

PTI | New Delhi | Updated: 16-01-2020 15:54 IST | Created: 16-01-2020 15:54 IST
Growth in office space leasing may moderate in 2020 after hitting record 58mn sq ft last yr: Savills

Office space leasing across India's six major cities rose by 22 per cent to record 57.7 million sq ft (gross) during 2019 on strong demand for worskspace from corporates, especially Americans, but pace of growth is likely to moderate to 7-8 per cent this year, according to global property consultant Savills. UK-based Savills, which is listed on London Stock Exchange and has 600 offices across 70 countries in the world with over 39,000 employees, has pegged the gross office leasing at 61-62 million sq ft in 2020 across six cities -- Bengaluru, Chennai, Hyderabad, Mumbai, National Capital Region (NCR) and Pune.

"The commercial segment, especially, the office space market is going from strength to strength, beating its own record of 47.3 million sq ft in 2018 to set a new one at 57.7 million sq ft in 2019," Savills India CEO Anurag Mathur told reporters here. This growth symbolises that office space across key markets is on a strong footing, driven by India's technology sector, rise in flexible spaces, formalisation of the Indian economy and the growing offshoring by western corporations, he added.

Of the total leasing, 40 per cent absorption was from US corporations, 30 per cent from European companies and 30 per cent from domestic entities. Asked about 2020 outlook, Mathur said the gross office space leasing is estimated at around 61-62 million sq ft.

"Growth will happen. It may not happen at the same rate as 2019," he said, adding that the demand was exceptional last year. Shweta Sawhney, MD (Delhi-NCR), said Hyderabad saw an increase of 53 per cent in office space leasing at 9.5 million sq ft in 2019. Chennai reported 60 per cent rise in absorption of office space at 8 million sq ft.

Office space leasing rose by 15 per cent in Bengaluru at 15.6 million sq ft, while Delhi-NCR witnessed 14 per cent growth at 10.89 million sq ft. In Mumbai, the gross leasing of office space grew by 11 per cent to 6.9 million sq ft. The absorption was stable in Pune at 6.8 million sq ft.

On rentals, Sawhney said office space rent grew maximum by 18-20 per cent in Chennai. Bengaluru saw a rise of 7-10 per cent in rental, Hyderabad 8-10 per cent, Mumbai 4-5 per cent, Pune 2-4 per cent, Gurugram 3-4 per cent and Noida 0-2 per cent. In Delhi, rentals were stable. Major demand generators for Grade-A office spaces on pan-India scale were technology sector companies at 46.3 per cent. Banking, financial services and insurance (BFSI) leased about 10.6 per cent of the overall space and co-working segment has 14 per cent share.

(This story has not been edited by Devdiscourse staff and is auto-generated from a syndicated feed.)



China: A savior for emerging markets or a poison pill?

... ...

Future of Urban Planning: Artificial Intelligence guiding the way

Advances in emerging technologies like Artificial Intelligence and Machine Learning can help us understand our cities better and derive useful insights from real-time data collected through automated models....


Latest News

Mexico may delay second doses of COVID-19 vaccine, allows private orders

Mexicos government said on Friday the second round of doses of the Pfizer COVID-19 vaccine could be delayed and private companies will be allowed to purchase the drugs directly as the country struggles to keep rampant infections in check.Me...

UK chief scientist says new virus variant may be more deadly

There is some evidence that a new coronavirus variant first identified in southeast England carries a higher risk of death than the original strain, the British governments chief scientific adviser said Friday -- though he stressed that the...

Nigeria: NHIS appoints Emmanuel Ononokpono as Media head

The National Health Insurance Scheme NHIS Nigeria has appointed Emmanuel Ononokpono, as the Head of Media and Public Relations, according to a report by Vanguard.Reportedly approved by Mohammed Nasir Sambo, the Executive Secretary of NHIS, ...

COVID effect: No motorcycle stunts at R-Day parade this year; spectators size cut to 25,000

Due to COVID-19 safety norms gravity-defying stunts by motorcycle-borne men, a major attraction for the crowd at Republic Day celebrations on the Rajpath, will be missing this year, while the spectator size too has been reduced to 25,000, o...

Give Feedback