According to Sanjay Dutt, chief executive officer business, Jones Lang LaSalle Meghraj (JLLM), During Q1 FY10, 4 mn sq ft of commercial space being leased out in metros in the first quarter of the financial year 2009-10, of the overall 55 mn sq ft of space available for commercial leasing across the country. By fourth quarter ending December 2009-10, we expect 27 mn sq ft of commercial area space to be leased out.
Commercial property transaction volumes in H12008 had fallen by 15% to 20% in both purchase and lease agreements in metros and 30% in tier-II cities in August 2008. This is mainly due to inflationary trends, liquidity crunch from the banks apart from hike in interest rates on home loans. As a result, builders majors have deferred they commercial project launches. According to Anshuman Magazine, managing director, CB Richard Ellis, The leasing commercial property market had witnessed dip in demand by about 10 to 15% in the fourth quarter of 2008. This is because, various multinationals were looking at postponing their expansion plans for office leasing.
Abhinandan Lodha, managing director, Lodha Group told FE, We have recently signed new commercial deals on lease rentals with many big corporates including Aditya Birla Group, KPMG, Ernst & Young , among host of other corporates for Lodha Excelus. When contacted, Aditya Birla Group spokesperson said the Groups talks with builders has reached advanced stages. KPMG is in the process of occupying close to 1 lakh sq ft office at Rs 110 on lease per month at Lodha Excelus, said the company spokesperson.
Recently, Wipro is understood to have bought 1 lakh sq ft office on lease in Hiranandani Gardens at Powai in Mumbai. Sources from Wipro have confirmed the new commercial deal on condition of anonymity. Niranjan Hiranandani, managing director, Hiranandani Constructions said, We are talking to many corporates who are scouting for additional office space in locations nearer to expansive business strategies. By June-end, we hope to finalise many corporates for Hiranandani Gardens. Meanwhile, Unilever, too, has also sold properties in Kolkata spanning 15 to 17 acres at a valuation of Rs 20 crore, a source added.
As per the recent commercial rental market update by Jones Lang LaSalle Meghraj, commercial leasing has picked up by 5% in volume terms in Q1 2009-10 nationally. Driving this growth are corporates who are now seeking to set up additional offices in metros that offer them better space at lower costs. However, this is much lower than 10% to 15% growth that market saw during Q1 of 2008-09.