Office absorption during the calendar year of 2015 has touched a record high of 38 million sq ft, led by Bangalore, according to real estate consulting firm CBRE reports fe Bureau in Mumbai. The city witnessed an annual absorption of 12 million sq ft followed by the NCR (National Capital Region), where 8.6 million sq ft was absorbed. IT/ITes companies led the surge by contributing 56% whereas the BFSI segment accounted for 12% of the total absorption
Occupiers mainly focussed on under-construction developments, nearing completion particularly in the suburban and peripheral locations of cities such as Bangalore, Hyderabad and Gurgaon. While most cities witnessed a y-o-y increase in occupier demand, Kolkata was the only exception. Delays in project completion, led to select corporate firms postponing their occupation decisions to the next financial year in Kolkata.
Interestingly, corporates preferred small to medium sized offices, which is a trend that was true throughout the year. Small-sized transactions (less than 10,000 sq ft) garnered a share of approximately 39%; while transactions ranging from 10,000–50,000 sq ft accounted for a share of about 45% of the total transaction activity reported during the quarter. Bangalore, Delhi NCR and Chennai dominated large-sized transaction closures (ranging between 100,000–400,000 sq ft) mainly for occupiers from the IT/ITeS, e-Commerce and engineering / manufacturing sectors.
Rental values remained largely stable across most micro-markets of leading cities during the quarter. Demand for newly completed properties, however, led to rental growth in select peripheral micro-markets.
A marginal rental appreciation of around 1–5% q-o-q was reported at ORR in Bangalore; DLF Cybercity in Gurgaon; Guindy, Vadapalani and Mayor Ramnathan Chettiar Nagar in Chennai; and the IT and extended IT corridors in Hyderabad. Rentals were stable for the most part in the Central Business Districts of most leading cities, barring Bangalore and Pune.