New Delhi: Net absorption of office space across top seven cities in the country touched 22 million sq ft in the first six months of the 2019 and likely to reach record a high of 42 million sq ft by the end of the year, accorded o report by property consultant JLL.
New completions of office space in the top seven cities-Delhi NCR, Mumbai Metropolitan Region, Pune, Bengaluru, Hyderabad, Chennai and Kolkata- clocked 23.4 million sq ft in the first six months of 2019, a growth of 16 percent as compared to the same period of 2018 when the new completions were to the tune of 21 million sq ft.
Office space vacancies came down to 13.3 percent in the first six months of 2019 from 14 percent in the corresponding period of 2018. IT industry accounted for 37 percent of the space take up in the first six months of 2019, while co-working pace providers took 15 percent of the total space take up in the period.
Favourable policy environment, steady economic growth and increasing preference of global occupiers for Indian offices and listing of first Real Estate Investment Trust (REIT) in the country have put the Indian office real estate market on a growth path, the report says.
“The current business scenario offers a favourable expansion environment to occupiers. Moreover, it also offers investors the option to look at maximizing their returns through investment into completed properties under REIT. The REIT listings by the Embassy-Blackstone Group Company clearly suggests that the commercial real estate in the country has matured and evolved in the past decade , post the global financial crisis. However, there is still a dearth of investment-worthy properties in the country. As a result, developers are focusing on increasing the supply of Grade A properties. We expect the momentum to remain robust in the second half of 2019 too,” said Ramesh Nair, CEO & Country Head, JLL India.