Office space leasing increased by 15 per cent in eight cities to 33.3 million sq ft during January-September this year driven by higher demand from corporates and co-working operators, property consultant Cushman & Wakefield (C&W) said Thursday.
Office space leasing increased by 15 per cent in eight cities to 33.3 million sq ft during January-September this year driven by higher demand from corporates and co-working operators, property consultant Cushman & Wakefield (C&W) said Thursday. The office space absorption stood at 29 million sq ft during the year ago period in eight cities — Delhi-NCR, Mumbai, Chennai, Kolkata, Bengaluru, Hyderabad, Pune and Ahmedabad.
The consultant said leasing could touch a record 50 million sq ft this calendar year. It expected absorption in the current quarter to remain strong like July-September period, during which 18.5 million sq ft space were leased. “2018 progresses on a note of exciting developments in office sector leasing. The compass for office space demand points north, for it is forecasted to spike to an unparalleled 50 million sq ft in the next few months, which surpasses records,” C&W India Country Head and MD Anshul Jain said.
He said, flexible workplaces was an overall contributor to leasing activity since the beginning of 2018 and and the trend is likely to continue. Leasing by co-working companies has risen two-fold so far this year as compared to the full year 2017, led by strong demand and low entry barriers.
Flexible workplace operators (co-working and business centers) overtook Ecommerce, Consulting and BFSI sectors to emerge as the third highest contributor to leasing activity so far this year. “A strong business environment is catalysing strong pre-commitments for future space in top markets,” Jain said. As per the data, office space leasing went up in Delhi-NCR, Bengaluru, Mumbai and Hyderabad and dropped in the rest four cities.
Hyderabad saw maximum rise of 53 per cent in office space leasing at 7.4 million sq ft during January-September 2018 compared to 4.8 million sq ft in the corresponding period of last year. Absorption rose by 44 per cent in Mumbai to 3.7 million sq ft, while Bengaluru saw 29 per increase to 12 million sq ft during the period under review. The Delhi-NCR market witnesses a 10 per cent growth in leasing at 6.3 million sq ft.
Among cities that faced decline in leasing activities, Kolkata saw 52 per cent fall at 0.4 million sq ft, followed by Ahmedabad that recorded a dip of 47 per cent at 0.2 million sq ft. Leasing fell by 44 per cent in Chennai to 1.7 million sq ft and 33 per cent in Pune to 1.6 million sq ft during the period under review.