Perfectly utilizing the sluggish realty market and the fallen rentals in the cities many of the corporates are now moving their headquarters to bigger offices where they will enjoy better amenities and facilities loaded with ample space.
Due to the sluggish realty market the rentals have fallen in many of the cities like Bangalore and Mumbai. Seeing this fall of rentals as a good opportunity, many of the corporates are moving their headquarters to bigger offices.
Bigger offices with ample space are also noted for better amenities and facilities. The corporates are sure that they enjoy better amenities now at comparatively an equal amount or slightly higher amount they used to spend for a small office now.
The Corporates feel that the headquarters is the sign of their prestige and status. The fall of rentals in some of the top cities of India has prompted them to think in this way to move their HQs to bigger offices.
At present, many Multinational companies like Bayer CropScience, FedEx, L’Oreal, Pepsi-Co and Volkswagen are moving their offices to bigger and fresher buildings. Along with these multinationals, prominent Indian companies like Britannia, Cipla and HDFC are also moving their offices to bigger offices now.
Managing Director of Jones Lang LaSalle India (West India) Mr. Ramesh Nair said that the office rentals and capital values have dropped nearly 25- 40 % since 2008. In his opinion this fall of rentals prompts the Corporates to enlarge their offices to bigger ones or to shift to bigger offices.
Many of the firms do not wish to shift their headquarters as they fear spreading up of wrong news about them. Further they are afraid that this will affect the business of the firm as well. Viewing this, most of the firms are leasing bigger offices for longer periods.
Buying of 1.3 lakh sq. ft. of office space and a separate commercial complex tower in central Mumbai, for over Rs.270 Cr by Pharmaceutical major Cipla is one such example. This was followed by German agrochemicals major Bayer CropScience which has shifted its HQ to Thane after buying a commercial building of Hiranandani Group. Beverage major PepsiCo is another one who hired 1.5 lakh sq. ft. office spaces on Golf Course Road Extension in Gurgaon.